Sebi eases foreign investment rules

Stock market regulator Securities & Exchange Board of India (Sebi) today, 25 June 2013, said it has accepted the recommendations the Committee set up under the Chairmanship of Shri K. M. Chandrasekhar, former Cabinet Secretary, Government of India (GoI), on Rationalization of Investment Routes and Monitoring of Foreign Portfolio Investments. Sebi said that it has simplified and made uniform entry norms for foreign investors by merging existing FIIs, Sub Accounts and Qualified Foreign Investors (QFIs) into a new investor class to be termed as "Foreign Portfolio Investors" (FPIs). In order to make the procedure much simpler, prior direct registration of FIIs and Sub Accounts with Sebi will be done away with. Instead, DDPs authorized by Sebi would register FPIs on behalf of Sebi subject to compliance with KYC requirements.

Sebi said that portfolio investments will be defined as investment by any single investor or investor group, which does not exceed 10% of the equity of an Indian company. Any investment beyond the threshold of 10% shall be considered as Foreign Direct Investment (FDI), it said.

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