Large Unit Holdings and Brokerage on associate applications - SEBI - MFD/CIR No.3/211/2001

Circulars GENERAL MANAGER MUTUAL FUNDS DEPARTMENT MFD/CIR No.3/211/2001 April 30, 2001 All Mutual Funds registered with SEBI / Unit Trust of India / AMFI Dear Sirs, As recommended by the Mutual Funds Advisory Committee of SEBI, it has been decided that the mutual funds shall disclose large unitholdings in the scheme which are over 25% of the NAV. The information on the number of such investors and total holdings by them in percentage terms, shall be disclosed in the allotment letters after the initial public offerings and also in the annual and the half-yearly results. It has also come to our notice that some of the mutual funds are paying brokerage / commissions on subscription of units by their associate entities. It is clarified that such payments should not be made and the mutual funds which have made such payments to the associates or to the agents or distributors in the past should reimburse the amounts paid to the respective schemes. The mutual funds shall report its compliance to SEBI within 30 days alongwith the details of the amount of commission reimbursed to the scheme(s). This circular is being issued in accordance with the provisions of Regulation 77 of the SEBI (Mutual Funds) Regulations, 1996. Yours faithfully,