Alerts & Updates 14th Nov 2025
On November 7, 2025, SEBI circulated for public comments a draft circular offering clarifications on various words and terms mentioned in Regulation 20(21) of AIF Regulations. Regulation 20(21) has been inserted in the AIF Regulations last November through an amendment to the SEBI (Alternative Investment Funds) Regulations, 2012, which was notified on November 18, 2024 and provides that investors in an AIF scheme shall have rights that are pro-rata to their commitment to the AIF scheme.
Subsequent to insertion of Regulation 20(21) in the AIF Regulations, SEBI issued a circular dated December 13, 2024 on ‘Pro-rata and pari passu rights of investors of AIFs’, which prescribed, inter-alia, specific exemptions from having to provide pro-rata rights to investors. The new rules for ensuring that investors have rights that are prorate and pari passu, though widely welcomed, also created certain ambiguities for fund accountants and administrators.
The draft circular released by SEBI on November 7, 2025 seeks to clarify some of those ambiguities.
Our update reviews SEBI’s draft circular and analyses its impact on AIFs.
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