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AMCs responsible for compliance of overseas agents

Now fund houses would be responsible for the compliance of overseas distributors, in the absence of an AMFI registration

August 26, 2013 4:23 IST | India Infoline News Service
Asset management companies (AMCs) would be responsible for the compliance of overseas agents as SEBI (Securities and Exchange Board of India) has exempted these agents from registration with AMFI (Association of Mutual Funds in India).

The fund houses would be responsible for the compliance of overseas distributors, in the absence of an AMFI registration, according to a circular issued by AMFI.

"AMCs are required to ensure compliance by the overseas distributors with the extant laws, rules and regulations of jurisdictions where they carry out their operations in the capacity of distributors while empanelling them, the circular said.

"It is clarified that since Amfi registration is not required by SEBI. AMFI would not be carrying out due diligence on these distributors on behalf of the mutual fund industry. AMCs will be fully responsible for any SEBI-related requirements on these distributors," it added.

Foreign distributors are not required to obtain a certificate from National Institute of Securities Markets (NISM). An NISM certification qualifies a distributor or an advisor to sell MF products.

In July 2012, SEBI had exempted foreign distributors from obtaining NISM certification. AMFI registration was also not required to comply with know-your- distributor process. 



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