SEBI Unveils Sweeping Reforms to Boost Investment in Indian Government Bonds and Startups
SEBI announced major reforms including KYC harmonization, easier investor group detailing for Foreign Portfolio Investors, and policy relaxations for startup ESOPs. The new regulations aim to boost investments in government bonds and support startup founders during IPOs while expanding investment avenues for alternative funds and angel investors.
- Country:
- India
In a bid to spur investment in Indian Government Bonds, the Securities and Exchange Board of India (SEBI) has approved a raft of relaxations for Foreign Portfolio Investors (FPIs). These changes, ratified in a meeting held in Mumbai, include harmonizing the KYC review periodicity with that of the Reserve Bank of India, as announced by SEBI Chairman Tuhin Kanta Pandey.
Notably, SEBI has waived the requirement for FPIs investing in government securities to submit investor group details, a move aimed at easing the regulatory burden. The board also extended the deadline for significant changes in FPI setups from 7 to 30 days, providing investors with added flexibility without sacrificing regulatory oversight.
In a nod to startup founders, SEBI has greenlit a proposal allowing them to retain Employee Stock Option Plans (ESOPs) even after filing for an Initial Public Offering (IPO). This significant shift addresses concerns over founder retention and motivation, marking a pivotal change from existing norms where promoters had to relinquish such benefits before IPO filings.
(With inputs from agencies.)
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