Indirect transfers: Category-II FPIs knock on govt doors for relaxation

At present, all FPIs under category-II are subject to transfer provisions which impacts close to 20 per cent of FPIs

A section of lobby groups has asked the central government to reconsider its stance on indirect transfer provisions on foreign portfolio investors (FPIs).
 
At present, all FPIs under category-II are subject to such transfer provisions, impacting close to 20 per cent of FPIs including a sizeable number of funds from Mauritius and the Cayman Islands.
 
Their request is the exemption of all sub-categories other than ‘corporate’ or ‘family office’ from these provisions.  To facilitate this, the grandfathering provisions should extend to FPIs registered as category-I or category-II under the 2014 regulations, irrespective of whether the investment was made