New disclosure norms not to impact a large number of FPIs: SEBI

Market regulator SEBI does not expect a large number of foreign portfolio investors (FPIs) to be impacted by the new beneficial ownership disclosure norms, according to sources. 

The norms are set to come into effect from February 1, and against this backdrop, the equity market has witnessed significant volatility. 

The sources in the know said that FPI which might be required to provide enhanced disclosures are expected to be significantly less than estimated in the consultation paper and the SEBI board’s note of October 2023.

“Exemption from enhanced disclosures have been provided to FPIs that are SWFs (sovereign wealth funds), listed companies on certain global exchanges, public retail funds and other regulated pooled investment vehicles with diversified global holdings,” one of the sources told the PTI on Wednesday. 

FPIs have been dumping shares in recent trading sessions. In the past four trading days alone, FPIs have sold shares worth over Rs 27,000 crore after pumping in huge money that had also pushed the market indices to record highs. 

“There is no risk of MPS (minimum public shareholding) norms violation in concentrated FPI holdings in companies with no identified promoter. Exemptions from enhanced disclosures take this into account. But for companies with no promoters like the HDFC Group or the ICICI group, the new disclosure norms will be effective,” the source said. 

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