IFSCA has clarified the following through Frequently Asked Questions (FAQs) on Registration of a Fund Management Entity (FME) and Authorization of a Scheme or Fund under IFSCA (Fund Management) Regulations, 2022:
Registration Documents for FME Application
One of the initial steps in the registration process involves submitting essential documents. The required documents vary based on the type of entity. For a company, documents such as the Certificate of Incorporation, Memorandum of Association, and Articles of Association are mandatory. Similarly, LLPs and Trusts have their specific document requirements, including the LLP agreement for LLPs and the Indenture of Trust for Trusts.
Existing Registrations and Financial Sectoral Regulators
Entities seeking registration must provide details about their existing registrations with IFSCA or other financial sectoral regulators in India or foreign jurisdictions. The format for submission is specified under Annexure 04.
Details of Key Executives
The FME application requires information about Key Executives, including the Principal Officer and Compliance Officer for the IFSC Office. Their detailed profiles, encompassing educational qualifications, certifications, and professional experience, must be submitted using Annexure 03.
Financial Statements and Net Worth Requirements
The financial documents required for the FME application include the previous three years’ consolidated/standalone audited financial statements. For newly incorporated entities, Income Tax Returns (ITRs) and acknowledgments can be submitted. The Net Worth Certificate, a crucial component, must not be older than six months and should meet the requirements specified by IFSCA.
Shareholding and Capital Structure Details
Detailed information about share ownership and the structure of capital, including Ultimate Beneficial Owners (UBOs) and Controlling Shareholders, must be provided. UBOs’ details, along with self-attested Know Your Customer (KYC) documents, are essential for submission.
Business Profile and Business Plan
The detailed business profile should provide insights into the applicant’s history, industry presence, and market position. Additionally, a comprehensive business plan outlining proposed activities within the IFSC is necessary for a clear roadmap.
Accounting Standards for FMEs and Schemes
FMEs and schemes may adopt various accounting standards, including Indian GAAP, IND AS, IFRS, or US GAAP, as permitted under applicable law.
Payment Details and Reference Rate
Entities are required to make payments as per the fee structure outlined by IFSCA. For those making fee remittances in INR, the applicable RBI reference rate for the specific day of fee remittance is to be employed.
In conclusion, navigating the registration process for FMEs in IFSC requires careful attention to detail and compliance with the specified requirements. This comprehensive FAQ guide serves as a valuable resource for entities seeking clarity on the intricate aspects of the registration process, facilitating a smoother journey into the world of fund management in the International Financial Services Centre.