Investment manager can manage multiple InvITs: Sebi

In its reply made public on Friday, Securities and Exchange Board of India (Sebi) said there is no provision in InvITs Regulations, which prevents an investment manager to manage more than one InvIT. "There is no explicit provision under InvITs Regulations that prohibits an investment manager to manage multiple InvITs provided they comply with regulations 19(4) of the InvIT Regulations," Sebi said in its three-page interpretative letter. "This letter does not express a decision of the board on the question referred," the regulator added.

An investment manager is allowed to manage multiple emerging investment vehicles -- InvITs -- markets regulator Sebi has said. However, transactions between two or more InvITs (infrastructure investment trusts) with a common investment manager or sponsor will deemed to be related party transactions for each of such trusts, the regulator added.

It, further, said if investment managers of InvITs are different but associates, the transactions between them will also be treated as related party transactions. The clarifications have been given as part of an informal guidance sought by India Infrastructure Trust regarding certain aspects of InvITs Regulations.

India Infrastructure Trust sought Sebi's guidance whether an entity that acts as investment manager to an InvIT is permitted act as the manager to other InvITs under the norms. In its reply made public on Friday, Securities and Exchange Board of India (Sebi) said there is no provision in InvITs Regulations, which prevents an investment manager to manage more than one InvIT.

"There is no explicit provision under InvITs Regulations that prohibits an investment manager to manage multiple InvITs provided they comply with regulations 19(4) of the InvIT Regulations," Sebi said in its three-page interpretative letter. The 19(4) of the InvIT Regulations deals with related party transactions.

Noting this position is based on the information furnished, Sebi said, "different facts or conditions might lead to a different interpretation". "This letter does not express a decision of the board on the question referred," the regulator added.