The International Financial Services Centres Authority (IFSCA) has announced significant changes aimed at simplifying the process for financial companies to launch investment schemes in the Gujarat International Finance Tec-City (GIFT City).
According to the IFSCA, the move is expected to enhance the ease of doing business in the fund management ecosystem at international financial services centres (IFSCs), promoting efficiency and attracting more investment opportunities.
Under the new guidelines outlined in a recent circular, companies will no longer need to wait for approval from the IFSCA before launching most investment schemes. Instead, they can submit the necessary paperwork, including a private placement memorandum (PPM), and commence the scheme without prior approval.
Fund management entities operating in IFSCs, particularly in GIFT City, can now launch investment schemes under chapter III of the International Financial Services Centres Authority (Fund Management) Regulations, 2022, without waiting for the IFSCA’s approval.
They need only to submit the required documents, including the PPM, ensuring minimum disclosures outlined in the circular.
The circular specifies essential information that must be included in the PPM for each scheme, such as scheme structure, target investors, governance structure, investment terms, fees, risk factors and more. A declaration of disclosure completeness is also required.
Companies can now extend the validity of the PPM beyond six months by resubmitting the documents to the IFSCA and paying the applicable fee.
Scheme filing fees must be remitted in US dollars at the time of submission, along with other necessary documents specified in the circular. Upon receipt of the application, the IFSCA will issue a letter of acknowledgment.
