International Financial Services Centres Authority (“IFSCA” or “Authority”), in exercise of powers conferred under Section 12 and Section 13 of the International Financial Services Centres Authority Act, 2019, read with Regulation 7 and Regulation 146 of the IFSCA (Fund Management) Regulations, 2025 (“FM Regulations”), vide Circular No. IFSCA-IF-10PR/1/2023-Capital Markets/6[1] dated February 20, 2025, issued the procedure for the appointment and change of Key Managerial Personnel (“KMPs”) of a Fund Management Entity (“FME”) operating in the International Financial Services Centre (“Circular”).
This Circular aligns with Regulation 7 of the FM Regulations, mandating the appointment of KMPs who meet the prescribed eligibility criteria, including educational qualifications, work experience, and location requirements. Any appointment of or change in KMPs shall be carried out only in the manner as specified by the Authority.
The key features of the Circular include:
- Intimation to IFSCA: Any appointment or change in KMPs shall be intimated to the Authority in the prescribed format, as provided in Annexure-A of the Circular, along with the payment of the applicable fee.
- Pending Applications: The Authority directs for all applications which are pending for approval as on the date of this Circular, to be refiled in accordance with the revised requirements, accompanied by proof of the fee already paid.
- Regulatory Review Process: The Authority shall review the intimation and communicate any observations within 7 (seven) working days and the FMEs shall duly consider these comments before proceeding with the appointment or change of KMPs.
- Compliance Responsibility: The FME and its controlling persons shall bear the responsibility of ensuring that all KMPs meet the eligibility criteria as prescribed by IFSCA.
- Succession Planning and Timelines: The FMEs shall have a structured approach to succession planning to maintain operational continuity. Further, the Authority has directed that any vacancy in a KMP position shall be filled within 3 (three) months from the date that it arises. Additionally, under no circumstances shall a KMP position remain vacant beyond 6 (six) months from the date of the previous incumbent’s departure.
[1]https://ifsca.gov.in/Viewer?Path=Document%2FLegal%2Fappointment-and-change-of-key-managerial-personnel-by-a-fund-management-entity20022025061756.pdf&Title=Appointment%20and%20Change%20of%20Key%20Managerial%20Personnel%20by%20a%20Fund%20Management%20Entity&Date=20%2F02%2F2025