**Summary:**
This circular, reference number SEBI/HO/IMD/PoD-2/PCIR/2023/152, dated September 06, 2023, issued by the Securities and Exchange Board of India (SEBI), clarifies the calculation of asset allocation limits for mutual fund schemes concerning investments in units of the Corporate Debt Market Development Fund (CDMDF).
The circular addresses a request from the Association of Mutual Funds in India (AMFI) regarding the base for calculating asset allocation limits. SEBI clarifies that, according to Part IV of Chapter 2 of the Master Circular for Mutual Funds dated May 19, 2023, investments in CDMDF units shall be excluded from the base of net assets when calculating these limits.
This provision takes effect immediately.
The circular is issued under Section 11(1) of the Securities and Exchange Board of India Act, 1992, and regulation 77 of SEBI Mutual Funds Regulations, 1996.
The circular is available on the SEBI website under the "Legal Circulars" section. For further information, contact Lakshaya Chawla, Deputy General Manager, at 022-26449369 or lakshayac@sebi.gov.in.
Key Entities Referenced
Securities and Exchange Board of India: Regulatory body for securities market in India, also known as SEBI
Asset Management Companies: Entities managing the investments of mutual funds.
Association of Mutual Funds in India: Industry association of mutual funds in India, also known as AMFI
Mutual Fund: A type of investment vehicle
Corporate Debt Market Development Fund: A fund related to corporate debt market, also known as CDMDF
SEBI Mutual Funds Regulations, 1996: Regulations governing mutual funds as defined by SEBI
Lakshaya Chawla: Deputy General Manager at SEBI who issued the circular.
CIRCULAR
SEBI/HO/IMD/PoD2/P/CIR/2023/152 September 06, 2023
Asset Management Companies (AMCs)/
Trustee Companies/ Board of Trustees of Mutual Funds/
Trustee Company of CDMDF/
Association of Mutual Funds in India (AMFI)
Sir / Madam,
Subject: Clarification regarding investment of Mutual Fund schemes in units
of Corporate Debt Market Development Fund
1. This has reference to SEBI Circular SEBI/HO/IMD/PoD2/P/CIR/2023/129 dated
July 27, 2023 on Investment by Mutual Fund Schemes and AMCs in units of
Corporate Debt Market Development Fund (“CDMDF”).
2. In this context, AMFI has requested that for calculation of asset allocation limits,
the base may be considered as net asset excluding of investment in units of
CDMDF.
3. It is therefore clarified that for calculation of asset allocation limits of mutual fund
schemes in terms of Part IV of Chapter 2 on ‘Categorization and Rationalization
of Mutual Fund Schemes’ of Master Circular for Mutual Funds dated May 19,
2023, investment in units of CDMDF shall be excluded from base of net assets.
4. The provisions of this circular shall come into force with immediate effect.
5. This circular is issued in exercise of powers conferred under Section 11 (1) of
the Securities and Exchange Board of India Act, 1992, read with the provisions
of regulations 77 of SEBI (Mutual Funds) Regulations, 1996, to protect the
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regulate the securities market.
6. This Circular is available at www.sebi.gov.in under the link “Legal > Circulars”.
Yours faithfully,
Lakshaya Chawla
Deputy General Manager
Tel no.: 022-26449369
Email: lakshayac@sebi.gov.in
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