Fema mess: Foreign-owned mutual funds approach Sebi to get issues resolved

Market watchers believe that the change in guidelines fly in the face of some of the recent initiatives taken by the government, such as easing norms for foreign portfolio investors

Foreign-owned or controlled mutual funds plan to approach market regulator Securities and Exchange Board of India (Sebi) after being stumped by the tweak in the Foreign Exchange Management Act (FEMA) guidelines, notified a few days ago.

The Association of Mutual Funds in India (Amfi), an industry body, is likely to take up the issue with Sebi on behalf of these fund houses, said people in the know. The fund houses are likely to make separate representations to the Department of Economic Affairs and the Reserve Bank of India, post consultations with Sebi.

“We will have to knock on every door,” said a