**Summary:**
This circular, issued by the Securities and Exchange Board of India (SEBI) on April 30, 2024, amends the existing regulations regarding nomination requirements for mutual fund unit holders. Specifically, it makes nomination optional for jointly held mutual fund folios. This decision is based on recommendations from a working group constituted to review the regulatory framework of Mutual Funds, with the goal of simplifying compliance and promoting ease of doing business.
The circular modifies clause 17.16 of Master Circular No. SEBI/HO/IMD/IMD-PoD-1/CIR/2023/74 dated May 19, 2023, read with Circular No. SEBI/HO/IMD/ PoD-1/CIR/2023/160 dated September 27, 2023 and Circular No. SEBI/HO/MIRSD/POD1/CIR/2023/193 dated December 27, 2023. While nomination is now optional for jointly held folios, all other provisions related to nomination requirements as outlined in the aforementioned circulars remain unchanged.
This circular is issued under the authority of Section 11(1) of the Securities and Exchange Board of India Act, 1992, and Regulations 29A and 77 of the SEBI Mutual Funds Regulations, 1996. It aims to protect the interests of investors in securities and promote the development and regulation of the securities market.
The circular is available on the SEBI website (www.sebi.gov.in) under the "Legal Framework Circulars" section.
For further information, contact Peter Mardi, Deputy General Manager, Investment Management Department, at Tel. No. 022-2644 9233 or via email at peterm@sebi.gov.in.
Key Entities Referenced
Securities and Exchange Board of India (SEBI): Regulatory body for securities market in India, issuing the circular.
Mutual Funds: Collective investment schemes that pool money from many investors to purchase securities.
Asset Management Companies (AMCs): Companies that manage investment funds, including mutual funds.
Association of Mutual Funds in India (AMFI): Industry association of mutual funds in India.
Registrars to an Issue and Share Transfer Agents (RTAs): Entities responsible for maintaining investor records and processing share transfers.
SEBI Master Circular No. SEBI/HO/IMD/PoD/1/CIR/2023/74: A key SEBI circular, dated May 19, 2023, related to mutual fund regulations, specifically concerning nomination.
SEBI Circular No. SEBI/HO/MIRSD/POD1/CIR/2023/193: A SEBI circular dated December 27, 2023 related to mutual fund regulations, specifically concerning nomination.
Securities and Exchange Board of India Act, 1992: The act of parliament that established SEBI and defines its powers and functions.
CIRCULAR
SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/29 April 30, 2024
To
All Mutual Funds
All Asset Management Companies (AMCs)
All Trustees of Mutual Funds
All Registrars to an Issue and Share Transfer Agents (RTAs)
Association of Mutual Funds in India (AMFI)
Sir / Madam,
Subject: Nomination for Mutual Fund Unit Holders – exemption for jointly held
folios
1. Clause 17.16 of Master Circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2023/74 dated
May 19, 2023 for Mutual Funds (‘Master Circular’) read with Circular No.
SEBI/HO/IMD/IMD POD1/P/CIR/2023/160 dated September 27, 2023 and Circular
No. SEBI/HO/MIRSD/POD-1/P/CIR/2023/193 dated December 27, 2023, inter alia,
prescribes the requirement for nomination/opting out of nomination for all the existing
individual unit holder(s) holding Mutual Fund units either solely or jointly, by June 30,
2024, failing which the folios shall be frozen for debits.
2. In order to simplify, ease and reduce cost of compliance, a working group was
constituted to review the present regulatory framework of Mutual Funds and
recommend measures to promote the ease of doing business. Based on the
recommendations of the working group, a public consultation was carried out.
3. Accordingly, it has been decided that the requirement of nomination specified under
clause 17.16 of the Master Circular for Mutual Funds shall be optional for jointly held
Mutual Fund folios.
4. All other provisions related to requirement of nomination as provided in SEBI Master
Circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2023/74 dated May 19, 2023 and
SEBI Circular No. SEBI/HO/MIRSD/POD-1/P/CIR/2023/193 dated December 27,
2023, shall remain unchanged.
5. This circular is issued in exercise of powers conferred by Section 11(1) of the
Securities and Exchange Board of India Act, 1992, read with Regulation 29A and
Regulation 77 of SEBI (Mutual Funds) Regulations, 1996, to protect the interests of
Page 1 of 2investors in securities and to promote the development of, and to regulate the
securities market.
6. This circular is available on SEBI website at www.sebi.gov.in under the categories
“Legal Framework -> Circulars”.
Yours faithfully,
Peter Mardi
Deputy General Manager
Investment Management Department
Tel. No. 022-2644 9233
Email: peterm@sebi.gov.in
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