Sebi gives more time to trustees to appoint dedicated officer

Earlier, trustees were required to appoint a dedicated officer by October 1 to assist them in their work. Now, the deadline has been extended till January 1, 2021, after receiving representation from industry body Amfi (Association of Mutual Funds in India), Sebi said in a circular.

Markets regulator Sebi on Wednesday gave time till January 1 to mutual funds' trustees for appointing a dedicated officer, who will assist them in monitoring various activities of asset management companies (AMCs). Earlier, trustees were required to appoint a dedicated officer by October 1 to assist them in their work.

Now, the deadline has been extended till January 1, 2021, after receiving representation from industry body Amfi (Association of Mutual Funds in India), Sebi said in a circular. The regulator in August came out with a framework that provides administrative assistance to trustees of mutual funds in monitoring various activities of AMCs.

The regulator asked trustees to appoint a dedicated officer having professional qualification and minimum 5 years of experience in finance- and financial services-related field. Under the guidelines, the officer so appointed will be the employee of trustees and shall directly report to them.

The scope of work for the officer will be specified by trustees from time to time to support the role and responsibilities of the trustees. The officer will accordingly assist the trustees and discharge the activities assigned to him. "The said officer shall be treated as access person," the Securities and Exchange Board of India (Sebi) had said.

Further, trustees will have standing arrangements with independent firms for special purpose audit and/or to seek legal advice in case of any requirement as identified and whenever considered necessary. The expenditure incurred for this will be charged under the clause of "fees and expenses of trustees" under the mutual fund norms.

Although, Sebi mentioned that the trustees will, however, continue to be liable for discharge of various fiduciary responsibilities as cast upon them.

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