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SEBI Clarifies Investment Scope for Category II AIFs May 21, 2025
Published in: Investment Funds
DISCLAIMER: The material contained in this publication is solely for information and general guidance and not for advertising or soliciting. The information provided does not constitute professional advice that may be required before acting on any matter. While every care has been taken in the preparation of this publication to ensure its accuracy, Vaish Associates Advocates neither assumes responsibility for any errors, which despite all precautions, may be found herein nor accepts any liability, and disclaims all responsibility, for any kind of loss or damage arising on account of anyone acting / refraining to act by placing reliance upon the information contained in this publication.
Securities and Exchange Board of India (“SEBI”), vide its notification dated May 21, 2025, has notified the SEBI (Alternative Investment Funds) (Amendment) Regulations, 2025, thereby amending the SEBI (Alternative Investment Funds) Regulations, 2012 (“AIF Regulations”).
Regulation 17(a) of the AIF Regulations has been substituted to clarify that Category II AIFs shall now invest in investee companies or in the units of Category I or other Category II AIFs as may be disclosed in the placement memorandum.
The explanation to Regulation 17(a) of the AIF Regulations specifies that Category II AIFs shall invest primarily in unlisted securities and/or listed debt securities (including securitised debt instruments) which are rated ‘A’ or below by a credit rating agency registered with SEBI, either directly or through investment in units of other AIFs, in the manner as may be specified by SEBI.
To read the notification click here
For any clarification, please write to:
Mr. Yatin Narang
Partner
[email protected]
