The Securities and Exchange Board of India (“SEBI”), in exercise of powers conferred under Section 12(1) and Section 12(1A) of the Securities and Exchange Board of India Act, 1992, and under Section 25 of the Depositories Act, 1996, vide Circular No. SEBI/LAD-NRO/GN/2025/254,[1] dated August 11, 2025, has notified the Foreign Portfolio Investors (Amendment) Regulations, 2025 (“Amended Regulations”), introducing targeted relaxations for Foreign Portfolio Investors (“FPIs”) who invest exclusively in Government Securities. The Amended Regulations shall come into force 180 (One Hundred and Eighty) days from the date of publication in the Official Gazette.
Summary of Amendments:
- Eligibility Criteria for FPIs: A new proviso has been added stating that sub-clauses (i), (ii), and (iv) of Regulation 4(c) of the Amended Regulations, which typically relates to broad-based criteria and ownership thresholds shall not apply to FPIs investing only in Government Securities, subject to SEBI-specified conditions.
- Obligations and Responsibilities of FPIs:
- Regulation 22 (1)(l): A proviso has been inserted exempting FPIs investing only in Government Securities from this clause, subject to SEBI-prescribed conditions.
- Regulation 22 (3): An exemption has been introduced for such FPIs from requirements related to control and beneficial ownership disclosures, again subject to SEBI conditions.
- Regulation 22 (5): Similar exemption added for FPIs investing only in Government Securities from the applicability of obligations under this sub-Regulation 22(5) of the Amended Regulations.
[1]https://www.sebi.gov.in/legal/regulations/aug-2025/securities-and-exchange-board-of-india-foreign-portfolio-investors-amendment-regulations-2025_96165.html