CIRCULAR
SEBI/IMD/CIR No. 1/165935/2009
June 9, 2009
To:
All Mutual Funds, Asset Management Companies (AMCs) and Association of Mutual Funds in India (AMFI)
Sir / Madam,
Sub: Guidelines for Investment by Mutual Funds in Indian Depository Receipts (IDRs) and copies of gazette notifications dated April 8, 2009 and June 5, 2009
1. In terms of regulation 43(1) of SEBI (Mutual Funds) Regulations 1996 (the Regulations), mutual funds are permitted to invest in securities. It is hereby clarified that mutual funds can invest in Indian Depository Receipts [Indian Depository Receipts as defined in Companies (Issue of Indian Depository Receipts) Rules, 2004] subject to compliance with SEBI (Mutual Funds) Regulations 1996 and guidelines issued thereunder, specifically investment restrictions as specified in the Seventh Schedule of the Regulations.
2. Further, find enclosed a copy of the gazette notification No. LAD-NRO/GN/2009-10/01/159601 and No. LAD–NRO/GN/2009-10/07/165404 pertaining to SEBI (Mutual Funds) (Amendment) Regulations 2009 for your information and implementation.
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,
