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TMI BlogOperational, Prudential and Reporting Norms for Alternative Investment Funds (AIFs)X X X X Extracts X X X X X X X X Extracts X X X X ..... borrow subject to consent from the investors in the fund and subject to a maximum limit, as may be specified by the Board Reg 18(d)- Category III Alternative Investment Funds shall be regulated through issuance of directions regarding areas such as operational standards, conduct of business rules, prudential requirements, restrictions on redemption and conflict of interest as may be specified by the Board. 2. Further, under Regulation 28 of the said Regulations, the Board may at any time call upon the Alternative Investment Fund to file such reports, as the Board may desire, with respect to the activities carried on by the Alternative Investment Fund. 3. In this regard, it is specified as under: 3.1 Risk Management and C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Category III AIFs which undertake leverage shall submit a report to SEBI on a monthly basis in the format as specified in Annexure II . iv. Reports shall be submitted by AIFs online through the online reporting system provided by SEBI. However, till such online system is made available, reports shall be sent by email to [email protected]. Excel sheet to be filled in this regard is available on SEBI website under the section 'Info for' 'Alternative Investment Funds'. Once the online system is made available by SEBI, no reports shall be sent by email. Further, AIFs are advised to note that no physical reports shall be filed with SEBI. v. The reports for the period upto the quarter ended June 30, 2013 for AIFs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all not accept new subscriptions. vii. The decision by the Manager to suspend redemptions, in particular the reasons for the suspension and the planned actions shall be appropriately documented and communicated to SEBI and to the investors. viii. The suspension shall be regularly reviewed by the Manager. The Manager shall take all necessary steps in order to resume normal operations as soon as possible having regard to the best interest of investors. ix. The Manager of such AIFs shall keep SEBI and investors informed about the actions undertaken by the manager throughout the period of suspension. The decision to resume normal operations shall also be communicated to SEBI and the investors as soon as possible. 3.4 Prudential req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue of the contract iii. Idle cash and cash equivalents shall not be included in the calculation of total exposure. Long put positions shall be considered as short exposure and short put positions shall be considered as long exposure. Short selling of a stock through SLBM shall be treated as short exposure. Temporary borrowing arrangements which relate to and are fully covered by capital commitments from investors need not be included in calculation of leverage. iv. Offsetting of positions shall be allowed for calculation of leverage for transactions entered into for hedging and portfolio rebalancing as provided in the circular No. MFD/CIR/21/ 25467/2002 dated December 31, 2002 and to the extent as specified in the circular. v. Sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken by SEBI against the AIF under SEBI (Alternative Investment Funds) Regulations, 2012 or the SEBI Act. iv. A confirmation of squaring off of the excess exposure shall be sent to all the clients by the AIF by end of the day on which the exposure was squared off. b. Obligation of custodian: i. The custodian shall report to SEBI providing name of the fund, the extent of breach and reasons for the same before 10 a.m. on the next working day. ii. A confirmation of squaring off of the excess exposure shall be sent to SEBI by the custodian by end of the day on which the exposure was squared off 4. Further, all AIFs shall ensure that all marketing documents of the fund/ scheme, if any, can be distributed on a private basis only t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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