SEBI proposes revamping of regulatory framework for FVCIs registration

Capital markets watchdog Sebi on Thursday proposed to streamline the regulatory framework for the registration of Foreign Venture Capital Investors (FVCIs).

In its consultation paper, Sebi has suggested that the process of granting registration to FVCIs and processing other post-registration references may be delegated to designated depository participants (DDPs) in line with provisions prescribed for FPIs (Foreign Portfolio Investors).

An applicant seeking registration as an FVCI should engage a DDP to avail of its services for obtaining a registration certificate as FVCI.

Presently, the processing of applications for granting registration to FVCIs and related due diligence is carried out by Sebi.

In addition, the regulator has suggested that the eligibility criteria for FVCIs should be streamlined, in line with that prescribed for FPIs. Also, it proposed that FVCIs should hold their investments in demat form.

The Securities and Exchange Board of India (Sebi) has sought comments from the public till May 31 on the proposals.

FVCI is an investor incorporated and established outside India, who invests primarily in unlisted securities of Venture Capital Undertakings and Venture Capital Funds.

As of March 2023, a total of 269 FVCIs are registered with Sebi. Further, the cumulative investments made by FVCIs directly in investee companies stood at Rs 48,286 crore during the period.