To streamline the liquidation processes of AIF schemes, the Securities and Exchange Board of India (Sebi) on Tuesday issued new guidelines for Alternative Investment Funds (AIFs) availing dissolution, seeking additional liquidation periods, and handling in-specie distribution of assets.
Schemes approaching dissolution must now file an information memorandum requiring a list of specified details with Sebi before the end of their liquidation or extended liquidation period. This must include a due diligence certificate from a merchant banker in the specified format.
For schemes requiring an additional or fresh liquidation period, a request must be submitted to Sebi with the necessary details. For in-specie distribution of investments, Sebi has mandated that unliquidated investments during the liquidation period can be carried out after the approval of at least 75% of investors by investment value in the scheme of AIF.
“The manager, trustee, and key management personnel of the AIF shall be responsible for ensuring compliance with these provisions,” Sebi said in a circular.