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Securities and Exchange Board of India

GENERAL MANAGER

INVESTMENT MANAGEMENT DEPARTMENT

IMD/CIR No.1/155740/2009

February 27, 2009

All Registered Portfolio Managers

Dear Sirs,

Sub: Extension in time for compliance with Regulation 16(8) of SEBI (Portfolio Managers) Regulations, 1993

As you are aware, vide SEBI (Portfolio Managers) (Amendment) Regulations, 2008, which were notified on August 11, 2008, certain amendments have been carried out in the SEBI (Portfolio Managers) Regulations, 1993. The said amendments include amendments to sub-regulation (8) of regulation 16 of the SEBI (Portfolio Managers) Regulations, 1993, which inter alia, states that –

“………………………………………………………. any portfolio manager holding the listed securities belonging to the portfolio
account in its own name on behalf of its client on the date of commencement of the Securities and Exchange Board of India (Portfolio Managers) (Amendment) Regulations, 2008 shall segregate each clients’ listed securities and keep them separately within six months from such commencement ”

However, SEBI has received representations from a number of portfolio managers informing that due to various reasons they are unable to comply with the above within the given time line of February 10, 2009 and requested to allow them further extension under the provisions of the aforesaid regulation. In consideration of such requests it has been decided to allow a general extension of three months to portfolio managers to comply with the above i.e. the portfolio managers are permitted to comply with the said requirements of sub-regulation(8) of regulation 16 of the SEBI (Portfolio Managers) Regulations, 1993 up to May 10, 2009.

In this regard, the portfolio managers shall furnish a compliance report to SEBI within a week of expiry of the above deadline. Any non compliance after the extended period i.e. after May 10, 2009 may attract penal action under the provisions of the SEBI Act, 1992 and the regulations framed there under.

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 16(8) and Regulation 39 of the SEBI (Portfolio Managers) Regulations, 1993, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

Yours faithfully,

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