Sebi eases processing of documents for FPI

New Delhi, Mar 30 (PTI) Relaxing compliance requirement for foreign portfolio investors (FPIs), markets regulator Sebi on Monday allowed scanned copies of documents for renewing registration in the wake of coronavirus pandemic.

The relaxation has been given till June 30, the Securities and Exchange Board of India (Sebi) said in a circular.

In light of the recent event pursuant to the COVID-19, a need has been felt for temporary relaxations with respect to compliance requirements for FPIs, it added.

Accordingly, the regulator has decided to grant the relaxations in a situation where FPIs are not in a position to send original and/ or certified documents.

Sebi has asked depository participants and custodians to process the request for registration, continuance, KYC and any other material change on the basis of scanned version of signed documents (instead of originals) and copies of documents which are not certified, received from e-mail IDs of their global custodians or existing clients where these details are already captured in records or e-mail IDs of new clients received from domains which are duly encrypted.

It, further said, these documents can be uploaded on KRAs (KYC registration agencies) and other intermediaries may rely on the papers.

Under Sebi guidelines, an FPI applicant needs to submit duly signed application form including KYC details and supporting documents and applicable fees. Further, copies of all the documents submitted by the applicant should be accompanied by originals for verification.

In case the original of any KYC document is not produced for verification, then the copies should be properly attested by entities authorized for attesting the documents.

Sebi said, the temporary relaxations shall be applicable till June 30, 2020.

The regulator has asked depository participants and custodians to ensure to obtain the original and/or certified documents within 30 days from the deadline.

Intermediaries should undertake necessary due diligence including that required for regulatory and risk based approach towards compliance with anti-money laundering (AML) requirements while processing these documents based on scanned copy, it noted.

In case required documents for registration or KYC are not received by the deadline, Sebi said the accounts of such FPIs will be blocked for any fresh purchase.

Further, in case documents are still not received within three months of the deadline, depository participants and custodians will have to  report these cases to Sebi for appropriate action.

In a separate circular, Sebi has relaxed the timeline for compliance with certain requirements for portfolio managers.

It has decided to extend the timelines by two months for monthly reporting to Sebi by portfolio managers for the periods ending March 31 and April 30.

The circular will come into force with immediate effect.