The Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 (“AIF Regulations”) allow Alternative Investment Funds (“AIF(s)”) to raise funds from any investor whether Indian, foreign or non-resident Indians, by way of issue of units.
With regard to foreign investment in AIFs, Securities and Exchange Board of India (“SEBI”) vide Circular dated December 9, 2022 (“Circular”) has specified that at the time of on-boarding such investors, the manager of the AIF shall ensure that -
SEBI has further specified that subsequent to the on-boarding, if the investors (including the investors already on-boarded to existing schemes of AIFs) do not meet the aforementioned conditions, the manager of the AIF shall not drawdown any further capital contribution from such investor until the conditions specified above are met again.
Please find a copy of the Circular here.
This update has been contributed by Aastha (Partner) and Arth Singhal (Associate).
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