SEBI/IMD/CIR No. 7/173650/2009

August 17, 2009

All Mutual Funds, Asset Management Companies (AMCs) and Association of Mutual Funds in India (AMFI)

Sir / Madam,

Sub:  Exit load – Parity among all classes of unit holders

Please refer to SEBI circular no. SEBI/IMD/CIR No. 6/172445/2009 dated August 7, 2009 on Exit Load – Parity among all classes of unit holders.  It is hereby clarified that –

1. All Mutual Funds shall ensure compliance with the aforesaid circular on or before August 24, 2009.
2. While complying with the aforesaid circular, it shall be ensured that:

1.The principle laid down in the SEBI circular No. SEBI/IMD/CIR No. 5/126096/08 dated May 23, 2008 (clause 16 of the standard observations) that “any imposition or enhancement in the load shall be applicable on prospective investments only” shall be followed.

2.The parity among all classes of unit holders in terms of charging exit load shall be made applicable at the portfolio level.

3. This circular is issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 77 of the SEBI (Mutual Funds) Regulations, 1996, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

 Yours faithfully,

Ruchi Chojer

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