SEBI Board Approves Higher Disclosure Threshold for FPIs to INR 50,000 Crore

On March 24, the Securities and Exchange Board of India (SEBI) approved a proposal to raise the disclosure threshold for foreign portfolio investors (FPIs) from Rs 25,000 crore to Rs 50,000 crore.

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This change aims to ensure compliance with regulations under the Prevention of Money Laundering Act (PMLA) and its associated rules (PMLR).

"Since cash equity market trading volumes have more than doubled between FY 2022-23 and FY 2024-25, the board has decided to revise the threshold from Rs 25,000 crore to Rs 50,000 crore. FPIs with equity assets under management (AUM) exceeding this limit in Indian markets will now be required to provide additional disclosures, as outlined in SEBI’s circular issued on August 24, 2023," stated the regulator in its official release.

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The primary objective of this disclosure requirement is to prevent any attempts to bypass Press Note 3, a 2020 government directive aimed at increasing scrutiny of foreign investments from nations that share a land border with India.

SEBI has, however, retained the existing rule requiring additional disclosures if more than 50% of an FPI’s equity AUM is concentrated within a single corporate group.

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