SEBI allows 12 new AIFs
The regulator for the securities market in India, Security and Exchange Board of India (SEBI), has allowed 12 new units to set up Alternative Investment Funds (AIFs).
An AIF is a new set of pooled-in investment vehicles for real estate, private equity and hedge funds, in the last two months of October and November 2012.
In the last few years, nine AIFs were allowed to set up shops by SEBI. A total of 20 applications were lying pending with SEBI for registration as AIFs.
Some of the 12 AIFs that were registered with SEBI starting from October 2010 are Capaleph Indian Millennium Small & Medium Enterprises Fund, Capaleph Indian Millennium Private Equity Fund, India Realty Fund and Dar Mentorcap Film Fund.
The rules laid down by SEBI are applicable to all AIFs irrespective of their kind of operations. The securities market regulator allows AIFs to operate in broadly three categories.
1. Category-I AIFs
They are the funds that get incentives from the government, SEBI or other regulators. It includes Social Venture Funds, Infrastructure Funds, Venture Capital Funds and SME Funds.
2. The Category-II AIFs
The investments can be made anywhere in any combination but are forbidden from raising debt, except for meeting their day-to-day operational requirements. These AIFs include PE funds, debt funds or fund of funds.
3. The Category-III AIFs
The funds trading with a view to make short-term returns and include hedge funds, among others.
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