Platform Play in GIFT-IFSC

At the 24th meeting of the International Financial Services Centres Authority (IFSCA) held on June 24, 2025, IFSCA, inter alia, approved a proposal to allow Registered Fund Management Entities in the IFSC to launch and manage Restricted Schemes on behalf of overseas or domestic third-party fund managers.

The key features of such Third-Party Fund Management Services (popularly known as “Platform Play”) would be as follows:

• It would not be necessary for the third-party fund manager to have a presence in the IFSC. The IFSC-based FME offering Third-Party Fund Management Services would have full regulatory responsibility and liability with respect to the third-party fund’s compliance with the International Financial Services Centres Authority (Fund Management) Regulations, 2025 (“FM Regulations”) and other applicable laws.
• Full liability and supervisory responsibility resting with the IFSC-based FME
• An FME that wishes to offer Platform Play, would require specific authorisation from IFSCA.
• An additional net worth requirement of USD 500,000 has to be met by FMEs offering Third-Party Fund Management Services
• Each Third-Party Fund/Scheme should have a dedicated principal officer in the IFSC
• The corpus of a Third-Party Fund/Scheme cannot exceed USD 50 million.

• IFSCA’s decision to permit FMEs in IFSCs to offer Platform Play to funds managed by other fund managers is a welcome step which will result in GIFT-IFSC becoming even more vibrant and international.
• The IFSCA has imposed a ceiling of USD 50 Million for the corpus of a Third-Party Fund/Scheme. This is possibly because this new facility is targeted at fund managers whose funds are not big enough for them to set up their own FMEs in the IFSC. Managers of larger funds would have to set up their own FMEs to operate in the IFSC. Since the FM Regulations require all Restricted Schemes to have a minimum corpus of USD 3 Million, third party Third-Party Funds set up in the GIFT-IFSC can have a corpus between USD 3 Million to USD 50 Million.
• It should be noted that the FM Regulations provide for three categories of FMEs, namely Authorised FME, Registered FME (Non-Retail) and Registered FME (Retail). Platform play can be offered only by Registered FMEs, both Non-Retail and Retail. Authorised FMEs (who manage Venture Capital Schemes) cannot launch and manage schemes on behalf of overseas or domestic third-party fund managers.
• Third-party schemes set up in GIFT-IFSC would have to be restricted schemes. A restricted scheme is defined by the FM Regulations to mean a scheme offered on private placement basis only to “accredited investors” or investors investing at least USD 1,50,000 and not having more than 1000 investors or such other number as may be specified by the IFSCA. Further, as per the FM Regulations, Restricted Schemes may be open ended or close ended. In case of an open-ended scheme, the maximum investment in unlisted securities should not exceed 25% of the corpus of the scheme. For an open-ended fund of funds scheme, this requirement shall not apply if such scheme is investing in other open-ended scheme(s) which have not invested more than 25% of their corpus in unlisted securities.

We trust you will find this an interesting read. For any queries or comments on this update, please feel free to contact us at insights@elp-in.com or write to our authors:

Vinod Joseph, Partner – Email – vinodjoseph@elp-in.com

Paridhi Jain, Associate – Email – paridhijain@elp-in.com