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CS Professional · IFSCA - Regulations, Listing and Compliances · Fund Management Services

Tara Investments has applied to IFSCA for authorisation as an FME and has already hired its team and leased an office in GIFT City. It proposes to start accepting investor commitments next week, before IFSCA has issued any certificate. What is the correct position under the Fund Management Regulations?

Tara Investments may not begin fund management activity or accept commitments until IFSCA grants authorisation or registration. A pending application, a ready office and hired staff give no right to operate. Even a limited investor base does not change this rule; the grant must come first.

  1. AIt may start, since the application is pending and the office is ready
  2. BIt may start if the application has been pending for over 30 days
  3. CIt may start with only accredited investors
  4. DIt may not carry on fund management activity until IFSCA grants authorisation or registrationCorrect

Explanation

A person cannot carry on fund management activity in the IFSC without first being granted authorisation or registration by IFSCA. A pending application, a ready office or a limited investor base does not confer permission. The activity may begin only after the grant.

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