The International Financial Services Centres Authority (IFSCA) on December 21, 2022, issued a circular on the distribution of Capital Market Products and Services under the International Financial Services Centres Authority (Capital Market Intermediaries) Regulations, 2021 and in recognition of the crucial role played by the distributors in the distribution of capital market products and services. The following directions for the distribution of capital market products and services has been stated:
• An entity desirous of setting-up operations in an IFSC to act as a registered distributor shall be required to seek registration with the Authority under regulation 3 of the Regulations and in terms of this Circular. Such an entity shall comply with all the norms as applicable under the Regulations, this Circular, and any other circular or guidelines issued by Authority in this regard from time to time.
• An entity desirous of obtaining a certificate of registration for carrying out activities as a registered distributor shall submit an application form to the Authority in the format provided in Part I of Schedule I of the Regulations along with the application fees as specified by the Authority.
• The entities desirous of availing simplified registration may apply by sending an application, comprising of a letter of intent, details of existing registration or license in terms of clause 14, details as required under clause 13, and fees as specified by the Authority.
• An entity seeking registration as a registered distributor shall maintain a net worth of at least USD 50,000 at all times.
• Every registered distributor and its employees shall abide by the code of conduct as specified in Schedule III of the Regulations and Annexure I of this circular.
• A registered distributor may enter into an arrangement with issuers, service providers, or associated distributors for the sale of capital market products and/or services through any digital mode.
