SEBI has issued Securities and Exchange Board of India (Mutual Funds) (Third Amendment) Regulations, 2024. Regulations provides the following obligations for Mutual fund lite asset management company:
- The directors of a mutual fund lite asset management company shall be appointed by the sponsor and the sponsor shall exercise diligence while making such appointments.
- The mutual fund lite asset management company shall take all reasonable steps and exercise due diligence to ensure that the investment of funds pertaining to any mutual fund lite scheme is not contrary to the provisions of these regulations and the trust deed.
- The mutual fund lite asset management company shall obtain, wherever required under these regulations, prior in-principle approval from the recognized stock exchange(s) where units are proposed to be listed.
- The mutual fund lite asset management company shall be responsible for the acts of commission or omission by its employees or the persons whose services have been procured by the asset management company.
- Notwithstanding anything contained in any contract or agreement or termination, the mutual fund lite asset management company or its directors or other officers shall not be absolved of liability to the mutual fund lite for their acts of commission or omission, while holding such position or office.
- The Chief Executive Officer (whatever be the designation) of the mutual fund lite asset management company shall ensure that the mutual fund lite complies with all the provisions of these regulations and the guidelines or circulars issued in relation thereto from time to time and that the investments made by the fund managers are in the interest of the unit holders and shall also be responsible for the overall risk management function of the mutual fund lite.
- Chief Executive Officer (whatever be the designation) shall also ensure that the mutual fund lite asset management company has adequate systems in place to ensure that the Code of Conduct for Fund Managers and Dealers specified in PART -B of the Fifth Schedule of these regulations are adhered to in letter and spirit. Any breach of the said Code of Conduct shall be brought to the attention of the board of directors of the mutual fund lite asset management company and trustees.
- The Fund Managers (whatever be the designation) shall abide by the Code of Conduct for Fund Managers and Dealers specified in PART -B of the Fifth Schedule of these regulations and submit a quarterly self-certification to the trustees that they have complied with the said code of conduct or list exceptions, if any.
