Regulation 6 - Consideration of application - Securities and Exchange Board of India (Portfolio Managers) Regulations, 1993

1 [6. Consideration of application.─ (1) For considering the grant of certificate of registration to the applicant, the Board shall take into account all matters which it deems relevant to the activities relating to portfolio management. (2) Without prejudice to the generality of the foregoing provisions, the Board shall consider whether- (a) the applicant is a body corporate; (b) the applicant has the necessary infrastructure like adequate office space, equipments and the manpower to effectively discharge the activities of a portfolio manager; 2 [(c) the principal officer of the applicant has either (i) a professional qualification in finance, law, accountancy or business management from a university or an institution recognized by the Central Government or any State Government or a foreign university; or (ii) an experience of at least ten years in related activities in the securities market including in a portfolio manager, stock broker or as a fund manager 3 [;] ] 4 [(iii) a CFA charter from the CFA Institute.] (d) the applicant has in its employment minimum of two persons who, between them, have at least five years experience 5 [in related activities in portfolio management or stock broking or investment management] or in the areas related to fund management; (e) any previous application for grant of certificate made by any person directly or indirectly connected with the applicant has been rejected by the Board; (f) any disciplinary action has been taken by the Board against a person directly or indirectly connected with the applicant under the Act or the Rules or the Regulations made thereunder. Explanation.─ For the purposes of sub-clauses (e) and (f), the expression person directly or indirectly connected means any person being an associate, subsidiary, inter-connected company or a company under the same management within the meaning of section 370(1B) of the Companies Act,1956 or in the same group; (g) the applicant fulfills the capital adequacy requirements specified in regulation 7; (h) the applicant, its director, principal officer or the employee as specified in clause (d) is involved in any litigation connected with the securities market which has an adverse bearing on the business of the applicant; (i) the applicant, its director, principal officer or the employee as specified in clause (d) has at any time been convicted for any offence involving moral turpitude or has been found guilty of any economic offence; (j) 6 [the applicant is a fit and proper person;] (k) grant of certificate to the applicant is in the interest of investors.] ******** 1 Substituted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2002, w.e.f. 11-10-2002. Prior to substitution, regulation 6 read as under: 6. Consideration of application.─ The Board shall take into account for considering the grant of a certificate, all matters which are relevant to the activities relating to portfolio manager and in particular whether the applicant complies with the following requirements namely: - (a) the applicant has the necessary infrastructure like adequate office space, equipments, and manpower to effectively discharge his activities; (b) the applicant has in his employment minimum of two persons who have the experience to conduct the business of portfolio manager; (c) a person, directly or indirectly connected with the applicant has not been granted registration by the Board in case of the applicant being a body corporate; Explanation.─ For the purposes of this clause the expression directly or indirectly connected means any person being an associate, subsidiary, inter-connected or group company of the applicant in case of the applicant being a body corporate; (d) the applicant fulfils the capital adequacy requirements specified in regulation 7; (e) the applicant, his partner, director or principal officer is not involved in any litigation connected with the securities market and which has an adverse bearing on the business of the applicant; (f) the applicant, his director, partner or principal officer has not at any time been convicted for any offence involving moral turpitude or has been found guilty of any economic offence; (g) the applicant has the professional qualification from an institution recognized by the Government in finance, law, accountancy or business management; gg) the applicant is a fit and proper person; [Clause (gg) inserted by the SEBI (Portfolio Mangers) (Amendment) Regulations, 1998, w.e.f. 05-01-1998.] (h) grant of certificate to the applicant is in the interest of investors. 2 Substituted by the SEBI (Portfolio Managers) (Second Amendment) Regulations, 2006, w.e.f. 05-07-2006. Prior to substitution, clause (c) read as under: (c) the principal officer of the applicant has the professional qualifications in finance, law, accountancy or business management from an institution recognized by the Government; 3 Substituted for . by the SEBI (Portfolio Managers) (Amendment) Regulations, 2016, w.e.f. 02-01-2017. 4 Inserted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2016, w.e.f. 02-01-2017. 5 Substituted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2008, w.e.f. 11-08-2008 for the words as portfolio manager or stock broker or investment manager. 6 Inserted by the SEBI (Portfolio Managers) (Amendment) Regulations, 1998, w.e.f. 05-01-1998.