Sebi allows transfer of PMS business between portfolio managers

Transfer of PMS business will now be permitted with Sebi's prior approval, provided the process is completed within two months of regulatory clearance

The Securities and Exchange Board of India (Sebi) on Friday allowed the transfer of Portfolio Management Services (PMS) business by one portfolio manager to another, after seeking prior approval from the regulator.

 

PMS transfer requires Sebi approval 

If the transferor and the transferee portfolio managers belong to different groups, they will have to make a joint application to Sebi for approval.

 

“The entire process of transfer shall be completed as expeditiously as possible but not later than two months from the date of approval. Until the transfer process is complete, the transferor shall continue to act as portfolio manager but shall not onboard any new client(s),” noted Sebi.

 

 

Registration certificate to be surrendered after transfer 

If the entire PMS business is transferred, the certificate of PMS registration of the transferor will have to be surrendered within 45 working days from the completion of the transfer.

 

Partial transfers allowed within same group 

In case of transfer of only certain investment approaches, the transferor may continue to hold the certificate of PMS registration. The transfer of specific investment approaches will only be allowed if the other portfolio manager belongs to the same group.