In exercise of the powers conferred under sub section 1 of Section 30 read with sub section 1 of Section 11 clause ba of sub section 2 of Section 11 and sub sections 1 and 1A of Section 12 of the Securities and Exchange Board of India Act

## Report on Securities and Exchange Board of India (SEBI) Payment of Fees Amendment Regulations, 2022 **1. Executive Summary:** This report analyzes the Securities and Exchange Board of India (SEBI) Payment of Fees Amendment Regulations, 2022, as published in the Gazette of India on November 9, 2022. This amendment primarily modifies the fees associated with Foreign Portfolio Investors (FPIs) and Foreign Venture Capital Investors (FVCIs) regulations. Key changes include a reduction in certain fees for FPIs and modifications to the fee structure for FVCIs. The purpose of this report is to provide stakeholders with a clear understanding of the implemented changes and their potential impact based solely on the provided policy text. **2. Introduction:** This report provides an overview of the Securities and Exchange Board of India (SEBI) Payment of Fees Amendment Regulations, 2022. The analysis is based solely on the provided policy text and aims to inform affected parties of the changes to fees associated with FPIs and FVCIs. **3. Policy Overview:** * **Original Policy Being Amended:** Securities and Exchange Board of India Foreign Portfolio Investors Regulations, 2019, and the Securities and Exchange Board of India Foreign Venture Capital Investors Regulations, 2000. * **Core Objective(s) (Inferred):** The core objective of the amendment is to adjust the fee structure for foreign investors regulated by SEBI, specifically Foreign Portfolio Investors and Foreign Venture Capital Investors. **4. Background and Rationale:** The provided text does not explicitly state the rationale behind the fee amendments. However, it can be inferred that the changes are designed to adjust the financial burden associated with operating as an FPI or FVCI in India. The fee reduction for FPIs and restructured fee payments for FVCIs suggest a possible recalibration of the regulatory environment to potentially attract or retain foreign investment. Without additional context, it is difficult to ascertain the exact reasons for these changes. **5. Key Provisions / Changes:** This section details the specific changes introduced by the amendment: * **Amendment 1: FPI Fee Changes:** * **Part of Original Policy Changed:** Second Schedule, Part A, clause 1 and Second Schedule, Part C, clause 1 of the Securities and Exchange Board of India Foreign Portfolio Investors Regulations, 2019. * **New Rule/Provision:** The amendment replaces "US 3000 and US 300" with "US 2500 and US 250" in Part A, clause 1. It also replaces "US 1000" with "US 800" in Part C, clause 1. * **Difference/Effect:** This represents a reduction in the fees applicable to FPIs. The exact nature of the fees being reduced (e.g., registration, annual) cannot be determined from the provided text alone. However, stakeholders should see a reduction in their financial obligations regarding these fees. * **Amendment 2: FVCI Fee Changes:** * **Part of Original Policy Changed:** Second Schedule, PART A of the Securities and Exchange Board of India Foreign Venture Capital Investors Regulations, 2000. * **New Rule/Provision:** PART A is completely substituted with a new fee structure: * Application fee: US 2,100 * Registration fee: US 8,500 * **Difference/Effect:** This signifies a change in the payment scheme for FVCIs. There is now a clear distinction and specification between application and registration fees. The overall impact on the financial obligations of FVCIs (increase or decrease) cannot be determined without knowing the previous fee structure, *but the new structure mandates explicit payment of an application fee*. **6. Target Audience and Stakeholders:** The primary target audience and stakeholders are: * **Foreign Portfolio Investors (FPIs)** currently registered or seeking registration with SEBI, as they are directly affected by the changes in fee amounts. * **Foreign Venture Capital Investors (FVCIs)** currently registered or seeking registration with SEBI, as they are subject to the revised fee structure. * The **Securities and Exchange Board of India (SEBI)** itself, as the implementing and regulatory body. **7. Implementation Aspects (Inferred):** * **Responsible Agency/Bodies:** The Securities and Exchange Board of India (SEBI) is the responsible body for implementing and enforcing these regulations. * **Timelines or Procedures:** The regulations came into force on November 1, 2022. No specific procedures are outlined in the provided text, but it is assumed that SEBI will update its systems and communicate the changes to the affected parties. * **Implementation Aspects of the Amendments:** FPIs and FVCIs will need to be aware of the new fee structures when making payments to SEBI. SEBI will need to update its systems to reflect these new fees. **8. Expected Outcomes / Impact of Changes:** The likely intended outcomes of these changes are: * **For FPIs:** The fee reduction may incentivize greater participation from FPIs in the Indian securities market. The lower costs could make the Indian market more attractive compared to other investment destinations. * **For FVCIs:** The restructured fee payment ensures clarity and separates the application fee from the registration fee. The impact on FVCI investments depends on the previous fee structure, but providing clarity should streamline the application process. * **Overall:** SEBI may be aiming to optimize its regulatory costs and attract foreign investment through these adjustments. **9. Conclusion:** The Securities and Exchange Board of India Payment of Fees Amendment Regulations, 2022, modifies the fee structure for Foreign Portfolio Investors and Foreign Venture Capital Investors. The changes, effective from November 1, 2022, entail reduced fees for certain FPI-related charges and a restructured fee payment with separate application and registration fees for FVCIs. These changes are likely intended to attract or retain foreign investment, and streamline the regulatory environment for foreign investors in India. Further analysis of the previous fee structures would provide a more comprehensive understanding of the full impact of these changes.

Key Entities Referenced