Schedule - 04 - Contents of the trust deed - Securities and Exchange Board of India (Collective Investment Schemes) Regulations, 1999

FOURTH SCHEDULE SECURITIES AND EXCHANGE BOARD OF INDIA (COLLECTIVE INVESTMENT SCHEME) REGULATIONS, 1999 [Regulation 17(1)] CONTENTS OF THE TRUST DEED 1. Principal Clauses The Trust Deed shall contain the following clauses, namely:- (a) the responsibilities, obligations and rights of the trustee for the protection of the assets of the 1 [collective investment scheme], (b) provisions to ensure that management of 2 [collective investment scheme] property shall be in accordance with that specified in the offer document and these regulations, (c) the responsibilities, obligations and rights of the Collective Investment Management Company, (d) the policies for issue, pricing of units and expenses of the 3 [collective investment scheme], including payment of fees and distribution of income and gains and accounting, (e) the policies for disclosures of the investors of various 4 [collective investment scheme]s objectives and investment objectives in offer documents and advertisements and annual and half-yearly reporting requirements, (f) provisions to ensure that the auditor for the 5 [collective investment scheme] shall be different from the Auditor of the Collective Investment Management Company. Further, it shall contain conditions of appointment, retirement, removal and replacement of auditor of the 6 [collective investment scheme], (g) broad policies regarding allocation of expenditure to capital or income, (h) provisions to explicitly forbid the acquisition of any asset out of the trust property which involves the assumption of any liability which is unlimited or shall not result in encumbrance of the trust property in any way, (i) trusteeship fee, if any, payable to the trustee, (j) provisions to the effect that no amendment to the Trust Deed shall be carried out without the prior approval of the Board and unit holders, (k) provisions to ensure that removal of the trustee in all cases shall require the prior approval of the Board and the provisions regarding appointment of new trustee and their removal be specified, (l) procedure for seeking approval of the unit holders, (m) provisions for redressal of grievances of the investors and time within which such complaints shall be redressed, (n) the circumstances under which the assets may be disposed of with the approval of the trustee, (o) provisions regarding transfer of units, meeting of unit holders and maintenance of upto date register of unit holders, (p) the time within which the unit certificates shall be issued after allotment and the time within which transfer of units shall be completed, (q) provisions to ensure that any document required to be lodged with the Board shall be signed by at least two Directors of the Collective Investment Management Company with at least one of them being an independent director, (r) provisions to ensure the public availability of the trust deed for inspection of unit holders and investors, (s) provisions to ensure that unit holders shall have beneficial interest in the trust property to the extent of individual holding in respective 7 [collective investment scheme]s only. 2. Trustee s duties regarding information properly, etc. The Trust Deed shall lay down that the trustee shall: (a) obtain necessary information and a quarterly report from the Collective Investment Management Company, (b) make spot checks on the Collective Investment Management Company regarding pricing of units and payment into and out of the 8 [collective investment scheme] and proper accounting of the income of the 9 [collective investment scheme] and charging of expenses and distribution as permitted, (c) maintain an arms length relationship with other companies, or institutions or financial intermediaries or any body corporate with which it may be associated, (d) take into their custody, or under their control all the property of the 10 [collective investment scheme]s and hold it in trust for the unit holders, (e) act in the interest of the unit holders, (f) provide or cause to be provide information to unit holders and Board as may be specified by the Board, (g) enter into an agreement for managing the 11 [collective investment scheme] property with the Collective Investment Management Company for this purpose, and shall enclose the same with the Trust Deed, (h) supervise the collection of any income due to be paid to the 12 [collective investment scheme] and for claiming any repayment of tax and holding any income received in trust for the holders in accordance with the Trust Deed, Offer document and regulations, (i) take reasonable care to ensure that the funds under the 13 [collective investment scheme]s floated by and managed by the Collective Investment Management Company are in accordance with the Trust Deed, Offer document and regulations, (j) have to remove the Collective Investment Management Company under the specific events only with the approval of Board in accordance with the regulations, (k) be responsible for the supervision of its activities of the Collective Investment Management Company in relation to the 14 [collective investment scheme] and shall also act as a Custodian of the assets of the 15 [collective investment scheme]. 3. Obligations of the Company The Trust Deed shall lay down that Collective Investment Management Company shall: (a) float 16 [collective investment scheme]s for the 17 [collective investment scheme] after approval by the trustee, and manage the funds mobilised under various 18 [collective investment scheme]s, in accordance with the provisions of the Trust Deed, Offer document and regulations, (b) not invest the corpus of the 19 [collective investment scheme] in other 20 [collective investment scheme], (c) not without the approval of the trustee publish or cause to be published any advertisement containing any invitation to buy units, or any statement with respect to the sale price of the units or the return expected from the 21 [collective investment scheme], (d) use its best endeavours to carry on and conduct its business in a proper and efficient manner and to ensure that the 22 [collective investment scheme] to which the deed relates is carried on and conducted in a proper and efficient manner, (e) make available to the trustee or to the auditors for inspection all the books of the 23 [collective investment scheme], (f) furnish to the trustee or to the auditors such oral or written information as the trustee or the auditor requires with respect to all matter relating to the 24 [collective investment scheme] or otherwise relating to the affairs of the 25 [collective investment scheme], (g) not exercise the right to vote in respect of any units relating to the 26 [collective investment scheme] held by the Collective Investment Management Company. ************* NOTES:- 1 ibid. 2 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 3 ibid. 4 ibid. 5 ibid. 6 ibid. 7 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 8 ibid. 9 ibid. 10 ibid. 11 ibid. 12 ibid. 13 ibid. 14 ibid. 15 ibid. 16 Substituted by the SEBI (Collective Investment Schemes) (Amendment) Regulations, 2014, w.e.f. 9-1-2014. 17 ibid. 18 ibid. 19 ibid. 20 ibid. 21 ibid. 22 ibid. 23 ibid. 24 ibid. 25 ibid. 26 ibid.