The Securities and Exchange Board of India (Alternative Investment Funds) (Second Amendment) Regulations, 2021 on the 5th May, 2021 has laid down a code of conduct for Alternative Investment Fund, key management personnel of the Alternative Investment Fund, trustee, trustee company, directors of the trustee company, designated partners or directors of the Alternative Investment Fund to abide by. The code of conduct lays down following requirements for AIFs:
- Carry out its business activities and invest in accordance with the investment objectives stated in the
placement memorandum and other fund documents. - Be operated and managed in the interest of all investors and not only in the interest of the sponsor,
manager, directors or partners of the sponsor and manager or a select class of investors. - Ensure the dissemination of adequate, accurate, explicit and timely information in accordance with these
Regulations to all investors. - Ensure the dissemination of any other information as agreed with the investors.
- Ensure that an effective risk management process and appropriate internal controls are in place.
- Have written policies and procedures to identify, monitor and appropriately mitigate any potential conflict
of interest through-out the scope of its business. - Not use any unethical means to sell, market or induce any investor to buy its units.
- Have written policies and procedures to comply with anti-money laundering laws.
