India’s market regulator, the Securities and Exchange Board of India (SEBI), has rolled out new rules to make the launch of Alternative Investment Fund (AIF) schemes faster and smoother. Under this framework, AIFs—except large value funds for accredited investors—can now circulate their placement memorandums (PPMs) to investors just 30 days after filing with SEBI, unless the regulator raises objections. Earlier, the process involved multiple rounds of scrutiny and delays, slowing down fund launches.
For first-time schemes, SEBI clarified that funds can proceed only after receiving registration or completing 30 days from filing, whichever is later. If SEBI issues comments during this period, they must be addressed before launch. To ensure discipline, AIFs must declare the first close of a scheme within 12 months of becoming eligible to launch.
The regulator has also shifted responsibility for disclosures firmly onto intermediaries. Merchant bankers and fund managers will now be accountable for the accuracy of all information in PPMs. They must submit due diligence certificates, sponsor commitments, fit-and-proper declarations, and identification documents of key personnel. SEBI has also standardized disclaimers, clarifying that filing a PPM does not mean regulatory approval.
Industry leaders welcomed the move, saying it will support quicker capital formation while ensuring stronger accountability. The rules apply immediately, even to pending applications, marking a decisive step towards faster fund mobilization with tighter oversight.
