Skip to content

Capital Market and Securities Laws · International Financial Services Centres Authority (IFSCA)

Establishment and Constitution of IFSCA: Chairperson and Members

Updated 11 October 2026 · Fact-checked

The Central Government establishes the International Financial Services Centres Authority by notification under Section 4 of the IFSCA Act, 2019. It is a body corporate with perpetual succession and a common seal. Under Section 5 it has a Chairperson and eight other Members, appointed by the Central Government. Each holds office for three years and can be re-appointed.

Understand Establishment and Constitution of IFSCA

IFSCA is the single regulator for financial services and products in International Financial Services Centres (IFSCs) in India. The 2019 Act creates it as a statutory body. You need to know how it is created, who sits on it, and for how long.

Section 4 says the Central Government shall, by notification, establish the Authority by the name International Financial Services Centres Authority. It is a body corporate with perpetual succession and a common seal. It can enter into contracts, acquire, hold and dispose of movable and immovable property, and sue and be sued in its own name. Perpetual succession means it continues even when its members change.

The head office is at the place the Central Government decides by notification. The Authority may set up offices elsewhere in India or outside India, but only with the prior approval of the Central Government.

Section 5 fixes the composition. The Members are appointed by the Central Government. They are: a Chairperson; one Member each nominated by RBI, SEBI, IRDAI and PFRDA (all ex officio); two Members from officials of the Ministry dealing with Finance, nominated by the Central Government (ex officio); and two other Members appointed on the recommendation of a Selection Committee. That makes nine in all.

The Chairperson is a whole-time Member. The two Selection Committee Members may be whole-time or part-time. Members must be persons of ability, integrity and standing with capacity in financial sector matters, or special knowledge or experience of law, finance, economics, accountancy, administration or another useful discipline. Section 6 gives a three-year term, with re-appointment allowed, subject to age limits.

Key rules to remember

Establishment (Section 4)
Central Government + notification → Authority; body corporate + perpetual succession + common seal
It can contract, hold property and sue or be sued by its own name.
Head office and other offices
Head office: place decided by Central Government notification. Other offices: prior approval of Central Government
Offices may be in India or outside India.
Composition (Section 5(1))
1 Chairperson + 4 ex officio (RBI, SEBI, IRDAI, PFRDA) + 2 Finance Ministry officials + 2 Selection Committee Members = 9
All appointed by the Central Government. Only the last two come through a Selection Committee.
Status of Members (Section 5(2))
Chairperson: whole-time. Two Selection Committee Members: whole-time or part-time
The Central Government decides for those two.
Term (Section 6(1))
Three years from entering office; eligible for re-appointment
Chairperson: no office after age 65. Whole-time Member: none after age 62.
Resignation and cooling-off (Section 6(3), (4))
Resign by written notice of at least 3 months. Two years after leaving: no Central/State Government employment or IFSC financial institution appointment without prior Central Government approval
The cooling-off applies to Members other than ex officio Members.
Section 9
No act of the Authority invalid merely due to a vacancy or defect in constitution or appointment
Protects decisions taken by the Authority.

How to solve Establishment and Constitution of IFSCA questions

Use this method for any question on the establishment or constitution of IFSCA, whether it is a short note, a list question or a case study.

  1. 1Identify what is asked: establishment, composition, qualifications, tenure, resignation or validity of acts.
  2. 2Start with the provision: name the IFSCA Act, 2019 and the section (Section 4 for establishment, 5 for composition, 6 for tenure, 9 for validity).
  3. 3State the rule in plain words with exact conditions, such as 'by notification' or 'prior approval of the Central Government'.
  4. 4For composition, list all categories and the count, and mark who is ex officio and who is chosen through the Selection Committee.
  5. 5Apply the rule to any facts given, such as a member's age, the date of resignation or a vacancy.
  6. 6End with a clear conclusion in one line that answers the question asked.

Quickest way: Nine-member count and three-year check

When to use it: Use it when time is short, or for composition and tenure questions.

  1. Write 1 + 4 + 2 + 2 = 9 and label each group: Chairperson, regulators, Finance Ministry, Selection Committee.
  2. Note the appointing authority: the Central Government for everyone.
  3. Write the tenure: 3 years, re-appointment allowed, age caps 65 (Chairperson) and 62 (whole-time Member).
  4. Add the exit rules: 3 months' written notice and a 2-year cooling-off.
  5. Write the answer in provision, analysis, conclusion order.

Common mistakes in Establishment and Constitution of IFSCA

  • Saying the Authority is established by the Act itself or by Parliament.

    Students assume statutory bodies are created directly by the Act.

    Fix: Section 4 says the Central Government establishes it by notification, for the purposes of the Act.

  • Giving the wrong number of Members or leaving out PFRDA.

    The list has several groups and students memorise only the main regulators.

    Fix: Remember 1 + 4 + 2 + 2 = 9. The four regulators are RBI, SEBI, IRDAI and PFRDA.

  • Saying all Members are chosen by a Selection Committee.

    The Selection Committee is mentioned in Section 5, so students over-apply it.

    Fix: Only the two clause (d) Members are appointed on its recommendation. The rest are the Chairperson and ex officio nominees.

  • Mixing up the age limits, or saying the Chairperson serves until 62.

    Both limits sit in one proviso.

    Fix: The Chairperson cannot hold office after 65. A whole-time Member cannot hold office after 62.

  • Saying offices outside the head office can be opened freely.

    Students overlook the condition in Section 4(4).

    Fix: Other offices in India or outside India need the prior approval of the Central Government.

  • Claiming a decision is invalid because a Member's post was vacant.

    Students confuse this with quorum or procedural rules.

    Fix: Under Section 9 no act is invalid merely because of a vacancy or a defect in constitution or appointment.

Worked examples

Example 1

Explain the composition of the International Financial Services Centres Authority and state who appoints its Members.

Show the solution
  1. Provision: Section 5(1) of the IFSCA Act, 2019 provides that the Authority consists of Members appointed by the Central Government.
  2. Chairperson: one person, who is a whole-time Member.
  3. Regulator nominees: one Member each nominated by RBI, SEBI, IRDAI and PFRDA, all ex officio. That is four.
  4. Government nominees: two Members from officials of the Ministry dealing with Finance, nominated by the Central Government, ex officio.
  5. Other Members: two appointed by the Central Government on the recommendation of a Selection Committee, whose composition and manner of constitution are prescribed by rules. They may be whole-time or part-time.
  6. Total: 1 + 4 + 2 + 2 = 9 Members.

Answer: The Authority has nine Members: a Chairperson, four ex officio nominees of RBI, SEBI, IRDAI and PFRDA, two Finance Ministry officials and two Members on the Selection Committee's recommendation. The Central Government appoints all of them.

Example 2

A whole-time Member of IFSCA, appointed for three years, turns 62 in the second year of her term. She also wishes to resign and join a financial institution in an IFSC six months after leaving. Advise.

Show the solution
  1. Age: Section 6(1) proviso says no person shall hold office as a whole-time Member after attaining 62 years. The three-year term does not override this.
  2. So her office ends when she turns 62, even though the term has not run out.
  3. Resignation: Section 6(3)(a) allows resignation by giving written notice of at least three months to the Central Government.
  4. Post-office restriction: Section 6(4) bars a Member, other than an ex officio Member, for two years after ceasing office from accepting appointment in any financial institution in an IFSC, except with the Central Government's previous approval.
  5. Six months is within two years, so she needs that prior approval.

Answer: Her office as a whole-time Member ends on attaining 62. If she resigns earlier, she must give at least three months' written notice. She cannot join an IFSC financial institution within two years of leaving without the Central Government's previous approval.

Exam tips

  • Learn Sections 4, 5, 6 and 9 as a set. Questions often ask for composition or tenure in a few lines.
  • When listing Members, give the count of each group and the total. Examiners reward a complete list.
  • Use exact words: 'by notification', 'body corporate', 'perpetual succession', 'common seal', 'prior approval of the Central Government'.
  • For case studies, check the age, notice period and two-year cooling-off before concluding.
  • Cite the Act and section next to each point. It shows the examiner you know the source.

Practice questions from International Financial Services Centres Authority (IFSCA)

Establishment and Constitution of IFSCA in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Establishment and Constitution of IFSCA: frequently asked questions

Who appoints the Chairperson of IFSCA?

The Central Government appoints the Chairperson under Section 5(1) of the IFSCA Act, 2019. The Chairperson is a whole-time Member. The term is three years and re-appointment is allowed, but no person can hold office as Chairperson after 65.

How many members does IFSCA have?

Section 5 provides for nine: the Chairperson, four ex officio nominees of RBI, SEBI, IRDAI and PFRDA, two Finance Ministry officials, and two Members appointed on the Selection Committee's recommendation.

Where is the head office of IFSCA?

The Act says the head office is at such place as the Central Government decides by notification. It does not name a city in the section. The Authority may open other offices in India or outside India with the Central Government's prior approval.

Can a Member of IFSCA take a job straight after leaving?

Not freely. For two years after ceasing to hold office, a Member other than an ex officio Member needs the Central Government's previous approval to accept employment under the Central or a State Government, or appointment in a financial institution in an IFSC.

Is an IFSCA decision invalid if a Member's post is vacant?

No. Section 9 says no act or proceeding of the Authority is invalid merely because of a vacancy or defect in its constitution, or a defect in a Member's appointment.