SEBI Allows Net Settlement For FPIs, Announces Key Ease Of Doing Business Reforms
SEBI approved net settlement for FPIs and introduced reforms to AIF regulations and InvITs to improve ease of doing business.Summary
The Securities and Exchange Board of India (SEBI) has announced key reforms aimed at improving the ease of doing business, including allowing Foreign Portfolio Investors (FPIs) to net settle their intraday cash market transactions, effective December 31, 2026. This change is expected to reduce liquidity pressure and funding costs for FPIs, who currently settle transactions on a gross basis. SEBI also approved proposals to amend Alternative Investment Fund (AIF) regulations, allowing schemes to retain liquidation proceeds post-tenure and introducing a framework for tagging 'inoperative funds' with reduced compliance requirements. Furthermore, the minimum investment value for individual investors in Social Impact Funds (SIFs) has been reduced to enhance retail participation. Infrastructure Investment Trusts (InvITs) will now be permitted to hold investments in Special Purpose Vehicles (SPVs) after concession agreements conclude and invest in liquid mutual fund schemes with a credit risk value of at least 10, providing additional investment options and mitigating concentration risk. SEBI stated that non-outright transactions will continue to be settled on a gross basis, addressing concerns about market influence.
(Source：Abp News)