Sebi Proposes Expanding Roles for Asset Management Companies

The Securities and Exchange Board of India (Sebi) unveiled proposals to expand the functions of asset management companies (AMCs) on Monday, suggesting they be allowed to act as Points of Presence (POP) for pension schemes and serve as global distributors for the funds they manage or advise.

Aimed at enhancing the scope of services provided by AMCs and their subsidiaries, the proposal includes permitting AMCs to market and sell direct plans of their mutual funds on a global scale through overseas subsidiaries. However, it maintains that AMCs shall not receive commissions or fees for distributing these direct plans.

Sebi's proposals extend to allowing AMCs to offer POP services for pension funds and distribute non-mutual fund schemes outside India, subject to regulatory compliance. Additionally, the relaxation of broad basing requirements is suggested, provided that governance and regulatory controls mitigate conflicts of interest.

(With inputs from agencies.)