The Securities and Exchange Board of India vide its notification dated 5th August 2021 has published the SEBI (Mutual Funds) (Second Amendment) Regulations, 2021 which shall come into force from 1st May 2022.
The Amendment is brought under regulation 25 which deals with Asset Management Company and its obligations in which as per regulation 25(16A), the asset management company shall invest such amounts in such schemes of the mutual fund, based on the risks associated with the schemes, as may be specified by the Board from time to time.”
Further under regulation 76(1), the Board may, in case of violation of any of the provisions of the Act or the regulations, initiate action under section 11, 11B, and/or section 24 of the Act and/or under Chapter VIA of the Act including passing an order to suspend the launching of any scheme of a mutual fund for a period not exceeding one year for violation of any of the provisions of these regulations or forfeit the amount invested by an asset management company in any of its schemes as required under sub-regulation (16A) of regulation 25
Provided that no order shall be passed without giving an opportunity of hearing.”
