Enhanced Disclosure Standards for Alternative Investment Funds

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Mar 30, 2020

Enhanced Disclosure Standards for Alternative Investment Funds

SEBI, by its Circular dated February 5, 2020, introduced a template for private placement memorandums (‘Template PPM’) of alternative investments funds (‘AIFs’) and mandatory performance benchmarking for AIFs. Some of the key features are: (a) the framework for performance benchmarking to be complied with by the investment manager; (b) AIFs should undertake an annual audit by an internal / external auditor / legal professional to ensure compliance with the Template PPM; (c) contribution agreement has to be compliant with and limited within the scope of the private placement memorandum; and (d) investor can provide waiver to the AIF from complying with the requirement to follow Template PPM and the annual audit, provided each investor of the AIF has committed a minimum of Rs 70 crore (approx. US$ 10 million).

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