Regulation 15 - General responsibilities of a Portfolio Manager - Securities and Exchange Board of India (Portfolio Managers) Regulations, 1993

15. General responsibilities of a Portfolio Manager.─ (1) The discretionary portfolio manager shall individually and independently manage the funds of each client in accordance with the needs of the client in a manner which does not partake character of a Mutual Fund, whereas the non-discretionary portfolio manager shall manage the funds in accordance with the directions of the client. 1 [(1A) The portfolio manager shall not accept from the client, funds or securities worth less than 2 [twenty five lacs] rupees.] 3 [Provided that the minimum investment amount per client shall be applicable for new clients and fresh investments by existing clients: Provided further that existing investments of clients, as on date of notification of Securities and Exchange Board of India (Portfolio Managers) (Amendment) Regulations, 2012, may continue as such till maturity of the investment.] (2) The portfolio manager shall act in a fiduciary capacity with regard to the client's funds. 4 [(2A) The portfolio manager shall keep the funds of all clients in a separate account to be maintained by it in a Scheduled Commercial Bank. Explanation.─ For the purposes of this sub-regulation, the expression Scheduled Commercial Bank means any bank included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934).] (3) The portfolio manager shall transact in securities within the limitation placed by the client himself with regard to dealing in securities under the provisions of the Reserve Bank of India Act, 1934 (2 of 1934). (4) The portfolio manager shall not derive any direct or indirect benefit out of the client's funds or securities. 5 [(4A) The portfolio manager shall not borrow funds or securities on behalf of the client.] 6 [(5) The portfolio manager shall not lend securities held on behalf of clients to a third person except as provided under these regulations.] (6) The portfolio manager shall ensure proper and timely handling of complaints from his clients and take appropriate action immediately. ********* 1 Inserted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2002, w.e.f. 11-10-2002. 2 Substituted by SEBI (Portfolio Managers) (Amendment) Regulations, 2012, w.e.f. 10-2-2012. 3 Inserted, ibid. 4 Inserted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2002, w.e.f. 11-10-2002. 5 Inserted by the SEBI (Portfolio Managers) (Amendment) Regulations, 2002, w.e.f. 11-10-2002. 6 Substituted, ibid. Prior to substitution, sub-regulation (5) read as under: (5) The portfolio manager shall not pledge or give on loan securities held on behalf of clients to a third person without obtaining a written permission from his client.