SEBI Board Approves New AIF & FPI Rules To Ease Compliance And Fund Management

In a recent SEBI board meeting, Tuhin Kanta Pandey outlined key reforms aimed at easing compliance for Alternative Investment Funds (AIFs) and Foreign Portfolio Investors (FPIs). AIFs will now be permitted to retain liquidation proceeds beyond their fund life to cover pending tax, litigation, or operational expenses, reducing their compliance burden while maintaining regulatory oversight. FPIs, meanwhile, will be allowed to settle outright cash market transactions on a net basis, enhancing operational efficiency and reducing funding costs, particularly during index rebalancing. These measures are expected to simplify fund management processes and improve ease of doing business in India’s capital markets.