Regulation 2 - Definitions - Securities and Exchange Board of India (Collective Investment Schemes) Regulations, 1999

Definitions 2. (1) In these regulations, unless the context otherwise requires: (a) Act means the Securities and Exchange Board of India Act, 1992 (15 of 1992); (b) advertisement includes: (i) notices, brochures, pamphlets, circulars, showcards, catalogues, hoardings, placards, posters, insertions in newspapers, pictures, films and cover pages of offer documents; (ii) any other matter to which publicity is given through print medium, radio, television programmes or electronic media; (c) appraising agency means an agency empanelled with the Board for the purpose of conducting technical or financial appraisal of the 1 [collective investment scheme]; (d) associate in relation to a collective investment management company or trustee, includes a person: (i) who, directly or indirectly, by himself, or in combination with other persons, exercises control over the Collective Investment Management Company or the trustee, as the case may be, or (ii) in respect of whom the Collective Investment Management Company or the trustee, as the case may be directly or indirectly, by itself, or in combination with other persons, exercises control, or (iii) whose director, officer or employee is a director, officer or employee of the Collective Investment Management Company or the trustee, as the case may be; 13 [ (e) auditor means a firm, including a limited liability partnership, constituted under the Limited Liability Partnership Act, 2008, who is eligible and qualified to audit the accounts of a company under section 141 of the Companies Act, 2013 (18 of 2013). ] 14 [ (ea) designated employees of the Collective Investment Management Company includes: (i) chief executive officer, chief investment officer, chief risk officer, chief information security officer, chief operation officer, fund manager, compliance officer, sales head, investor relation officer, heads of other departments and dealer of the Collective Investment Management Company; (ii) persons directly reporting to the chief executive officer (excluding personal assistant/ secretary); (iii) fund management team and research team; (iv) other employees as identified by Collective Investment Management Companies or trustees. ] (f) Board means the Securities and Exchange Board of India established under the provisions of section 3 of the Act; (g) certificate means a certificate of registration granted under regulation 10 of these regulations; (h) Collective Investment Management Company means a company incorporated under the Companies Act, 1956 (1 of 1956) 15 [ or the Companies Act, 2013 (18 of 2013) ] and registered with the Board under these regulations, whose object is to organise, operate and manage a collective investment scheme; (i) collective investment scheme has the meaning assigned to it by sub-regulation (2) of this regulation; (j) closed-ended 2 [collective investment scheme] means any 3 [collective investment scheme] launched by a Collective Investment Management Company, in which the period of maturity of the 4 [collective investment scheme] is specified and there is no provision for re-purchase before the expiry of the maturity of the 5 [collective investment scheme]; (k) control or controlling interest means control exercised or controlling interest held : 16 [ (i) in the case of a company, by any person individually or together with persons acting in concert, who directly or indirectly own, control or hold shares carrying not less than ten percent of the voting rights of such company; or (ii) as between two companies, if the same person either individually or together with persons acting in concert, directly or indirectly, own, control or hold shares carrying not less than ten percent of the voting rights of each of the two companies; or ] (iii) 17 [ by ] majority of the directors of any company who are in a position to exercise control over the Collective Investment Management Company; (l) credit rating agency means a body corporate registered under Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999; (m) depository means a body corporate as defined in the Depositories Act, 1996 (22 of 1996); 18 [ (n) **** ] (o) form means any of the forms specified as such in the First Schedule; 19 [ (p) fraud means a fraud as defined in sub-clause (c) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003; ] (q) inspecting officer means any person appointed as such by the Board under Chapter VII of these regulations; (r) key personnel in relation to a company, means the persons who exercise effective control over its affairs; (s) net worth means the aggregate value of the paid-up equity capital and free reserves (excluding funds created out of revaluation), reduced by the aggregate value of accumulated losses and deferred expenditure not written off, including miscellaneous expenses not written off; (t) offer document means any document by which applications for subscribing to units of the 6 [collective investment scheme] are invited from the public; (u) regulation means a regulation forming part of these regulations; 20 [ (v) relative means a person as defined in section 2(77) of the Companies Act, 2013 (18 of 2013). ] (w) registrars to an issue and share transfer agent means a person registered as Registrars to an Issue and Share Transfer Agents under the Securities and Exchange Board of India (Registrar to an Issue and Share Transfer Agents) Regulations, 1993; (x) schedule means any of the schedule appended to these regulations; 7 [(y) ****] (z) 8 [collective investment scheme] property includes: i. subscription of moneys or money s worth (including bank deposits) to the 9 [collective investment scheme]; ii. property acquired, directly or indirectly, with, or with the proceeds of, subscription of money referred to in item (i) of this Clause; or iii. income arising, directly or indirectly, from subscription money or property referred to in item (i) or (ii), 21 [ (aa) securities laws means the Act, the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and the Depositories Act, 1996 (22 of 1996), the provisions of any other law to the extent it is administered by the Board and the relevant rules and regulations made thereunder; ] (bb) stock broker means a stock broker as defined in Securities and Exchange Board of India (Stock Brokers and Sub-brokers) Rules, 1992 cc) trustee means a person who holds the property of the collective investment scheme in trust for the benefit of the unit holders, in accordance with these regulations; dd) unit includes any instrument issued under a 10 [collective investment scheme], by whatever name called, denoting the value of the subscription of a unit holder; and ee) unit holder means a person holding a unit in a 11 [collective investment scheme]. 12 [(2) In these regulations the expression collective investment scheme shall have the same meaning as assigned to it under section 11AA of the Act.] 22 [ (3) The words and expressions used and not defined in these regulations but defined in the Act, the Securities Contracts (Regulation) Act, 1956 (42 of 1956), the Companies Act, 2013 (18 of 2013), the Depositories Act, 1996 (22 of 1996), or any rules or regulations made thereunder shall have the same meanings respectively assigned to them in those acts, rules or regulations made thereunder or any statutory modification or re-enactment thereto, as the case may be. ] ************* NOTES:- 1 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 2 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 3 ibid. 4 ibid. 5 ibid. 6 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 7 Omitted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 8 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 9 ibid. 10 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 11 ibid. 12 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2000, w.e.f. 14-2-2000. Prior to its substitution the sub-regulation 2 of Regulation 2 read as under: (a) the purpose of which is to enable the investors to participate in the scheme or arrangements by way of subscriptions and to receive profits or income or produce arising from the management of such property or the investments made thereof; and (b) in which the subscriptions of the investors by whatever name called, are pooled, and are utilized for the purposes of the schemes or the arrangements; and (c) in which the property or such subscriptions are managed on behalf of the investors, who do not have day to day control over the management or operation of the scheme, whether or not such properties or subscriptions and the investments made thereof are evidenced by identifiable properties or otherwise; Provided that following shall not be deemed to be a collective investment scheme: (a) acceptance of deposits by companies under section 58A of the Companies Act, 1956 (1 of 1956) or by Non-Banking Financial Companies as defined in section 45-I of the Reserve Bank of India Act, 1934 ( 2 of 1934 ); b) acceptance of funds by Chit Funds in terms of the Chit Funds Act, 1982 (40 of 1982); (c) acceptance of funds by companies declared as Nidhi companies under section 620A of the Companies Act, 1956, ( 1 of 1956 ), as per directions issued under, section 637A of the said Act; (d) contracts of insurance under the Insurance Act, 1938 ( 4 of 1938 ); (e) any scheme of the employer as per Employees Provident Fund and Miscellaneous Provisions Act, 1952, ( 19 of 1952); or any other recognized Provident Fund under the Income Tax Act, 1961; (f) arrangements of cooperative societies under the Cooperative Societies Act, 1912 ( 2 of 1912 ) including Cooperative Societies registered under any Provincial Act or State Act for the time being in force; (g) any scheme under Securities and Exchange Board of India (Mutual Funds ) Regulations, 1996; or (h) any other scheme or arrangement specifically exempted by the Board, from the operation of these regulations. 13. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (e) auditor means a person qualified to audit the accounts of companies under the Companies Act, 1956; 14. Inserted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 15. Inserted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 16. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (i) in case of a company, by any person or combination of persons who directly or indirectly own, control or hold shares carrying not less than 10% of the voting rights of such company; or (ii) (ii) as between two companies, if the same person or combination of persons, directly or indirectly, own, control or hold shares carrying not less than 10% of the voting rights of each of the two companies; or 17. Inserted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 18. Omitted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (n) economic offence means an offence to which the Economic Offences (Limitation of Prosecutions) Act, 1974 (12 of 1974) applies for the time being; 19. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (p) fraud , has the same meaning as is assigned to it in section 17 of the Indian Contract Act, 1872 (9 of 1872); 20. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (v) relative means a person who is a relative, as defined in section 6 of the Companies Act, 1956 (1 of 1956); 21. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, aa) stock broker means a stock broker as defined in Securities and Exchange Board of India (Stock Brokers and Sub-brokers) Rules, 1992; 22. Substituted vide Notification No. SEBI/LAD-NRO/GN/2022/84 dated 10-05-2022 before it was read as, (3) Words and expressions used and not defined in these regulations, but defined in the Act shall have the same meanings as are respectively assigned to them in the Act.