The Securities and Exchange Board of India issued the Securities and Exchange Board of India (Alternative Investment Funds) (Amendment) Regulations, 2026, introducing key changes to the existing AIF regulatory framework. The amendment significantly reduces the minimum threshold mentioned in Regulation 10(c) from “two lakh” to “one thousand,” thereby easing compliance requirements. Further, Regulation 29 has been modified to provide greater regulatory flexibility, allowing distribution of proceeds subject to conditions specified by SEBI from time to time. A notable insertion is the introduction of sub-regulation (10A), which enables classification of an Alternative Investment Fund as an “inoperative fund,” subject to prescribed conditions. These amendments aim to enhance operational flexibility, improve regulatory clarity, and strengthen oversight mechanisms for AIFs. Overall, the changes reflect SEBI’s intent to streamline fund management processes while ensuring adaptability in compliance and monitoring of inactive or dormant funds within the alternative investment ecosystem.
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 16th April, 2026
SECURITIES AND EXCHANGE BOARD OF INDIA (ALTERNATIVE INVESTMENT FUNDS) (AMENDMENT) REGULATIONS, 2026
No. SEBULAD-NRO/GN/2026/303.— In exercise of the powers conferred by sub-section (1) of Section 30 read with sub-section (1) of Section 11, clause (ba) and clause (c) of sub-section (2) of Section 11 and sub-section (1) and (1B) of Section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following regulations to further amend the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012, namely, —
1. These Regulations may be called the Securities and Exchange Board of India (Alternative Investment Funds) (Amendment) Regulations, 2026.
2. They shall come into force on the date of their publication in the Official Gazette.
3. In the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012, —
I In the third proviso to regulation 10(c), the words “two lakh” shall be substituted with the words “one thousand”.
II. In regulation 29,
a. in sub-regulation (7), after the words “satisfying all liabilities”, the words and symbol “, subject to conditions as may be specified by the Board from time to time” shall be inserted.
b. after sub-regulation (10) and before sub-regulation (11), the following new sub-regulation shall be inserted, namely, –
“(10A) An Alternative Investment Fund may be tagged as an inoperative fund, in such manner and subject to conditions as may be specified by the Board from time to time.”
AMIT PRADHAN, Executive Director
[ADVT.-III/4/Exty./46/2026-27]
Note:
The Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 was published in the Gazette of India on May 21, 2012 vide notification No. SEBI/LAD-NRO/GN/2012-13/04/11262 and was last amended on November 19, 2025 by the Securities and Exchange Board of India (Alternative Investment Funds) (Third Amendment) Regulations, 2025 vide notification No. SEBI/LAD-NRO/GN/2025/274.
