Sebi streamlines mutual fund registration and maintains CAS framework

The Securities and Exchange Board of India (Sebi) has introduced a streamlined registration process for mutual funds under the Sebi (Mutual Funds) Regulations, 2026. The regulator has replaced the previous two-stage approval process—which required separate in-principle and final registration forms—with a single, consolidated application framework.

Under this new system, prospective sponsors and asset management companies must provide extensive disclosures. This includes detailed information regarding financial history, ownership structures, capital strength, management, and regulatory track records. Sponsors are now required to disclose ultimate beneficial owners, shareholding patterns, and audited financial statements covering the previous five financial years.

Separately, Sebi Chairman Tuhin Kanta Pandey confirmed that the Closing Auction Session (CAS) framework, which took effect on August 3, will remain in place. While acknowledging feedback and criticisms regarding the framework, Pandey stated that the regulator is analyzing suggestions to identify potential improvements. He noted that many current concerns may diminish as market participation in the CAS increases.