SEBI settles charges against power sector VC fund

The INR2.3billion fund was established in 2004 as India's first power-focused vehicle and registered with SEBI as a venture capital fund. It received commitments from as many 21 public sector banks, financial institutions and insurance companies including Life Insurance Corporation of India.

SEBI launched its inquiry after being informed of a potential breach in regulations by the country's income tax department.

The fund sought settlement of these proceedings through SEBI's consent mechanism, wherein a case can be settled after payment of certain charges. In its consent order, dated November 1, Sebi said its High Powered Advisory Committee accepted the consent terms, which were later agreed upon by the regulator's panel of whole-time members.

In April, SEBI released a final version of new regulations intended to tighten its control over the private equity industry. The new rules governing alternative investment funds (AIFs) replace the venture capital funds (VCF) system, which was seen as unwieldy because classification requirements are so broad because there is no mandatory registration.

In May, Indian private equity funds were told they had a six month window in which to comply.

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• Topics
• South Asia
• Regulation
• Venture
• regulation
• SEBI
• India
• Venture