SEBI Extends timelines for Mutual Fund Unit Holders Nomination

The Securities and Exchange Board of India(SEBI) has issued a Circular to notify the Extension of timelines for Mutual Fund Unit Holders Nomination.

SEBI vide Circular No SEBI/HO/IMD/IMD-II DOF3/P/CIR/2022/82 dated June 15, 2022 (Circular) mandated submission of nomination details/declaration for opting out of a nomination for investors subscribing to mutual fund units on or after August 1, 2022.

Based on the representation received from AMFI, it has been decided that:

a. Para 1 of the Circular will be read as “Investors subscribing to mutual fund units on or after October 1, 2022, shall have the choice of:”.

b. Para 2 of the Circular will be read as “AMC shall provide an option to the unit holder(s) to submit either the nomination form or the declaration form for opting out of the nomination in physical or online as per the choice of the unit holder(s). In case of a physical option, the forms shall carry the wet signature of all the unit holder(s). In case of the online option, instead of wet signature(s) of all the unit holder(s), AMCs shall validate the forms:

i. using e-Sign facility recognized under Information Technology Act, 2000; or

ii. through two-factor authentication (2FA) in which one of the factors shall be a One-Time Password sent to the unit holder at his/her email/ phone number registered with the AMC”.

This circular is issued in exercise of the powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with the provision of Regulation 77 of 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.