Mauritius based funds eligible for registration as Category I FPI

14 April 2020
Mauritius based funds eligible for registration as Category I Foreign Portfolio Investor (FPI) with Securities and Exchange Board of India (SEBI)

Effective 7 April 2020, SEBI has amended their FPI Regulations, 2019 to provide that FPI applicants from a non-FATF member country may also qualify for a Category I registration provided such country is specified by the Indian Central Government for this purpose or the Indian Central Government enters into an agreement or treaty with such country.

The Indian Ministry of Finance issued an order on 13 April 2020 stating that Mauritius is now an eligible country for the purpose of registering for a Category I FPI license.

With this order from the Central Government of India, Mauritius based funds will now be able to register for a Category I FPI License and therefore benefit from the numerous advantages available to Category I FPIs, including:

  1. Exemption from indirect share transfer provisions;
  2. Higher derivative position limits;
  3. Ability to issue and subscribe to Offshore Derivative Instruments (ODIs - such as Participatory Notes or Total Return Swaps) backed by underlying Indian securities; and
  4. Lower KYC documentation

In line with the above, kindly see the Communiqué issued by the Mauritius Financial Services Commission and the ‘Order’ issued by the Indian Ministry of Finance – Department of Economic Affairs