Restrictions on Investment and AUM of the Scheme

47. (1) In case of an open-ended scheme, the maximum investment in unlisted securities should not exceed fifteen per cent. (15%) of the total AUM of the scheme: Provided that this restriction shall not be applicable in case of investment in unlisted securities issued by an investment fund which is open-ended in nature, regulated by the concerned regulatory authority in its home jurisdiction, and is permitted for offering to retail investors in its home jurisdiction. (2) The minimum amount of investment by an investor in case of close-ended schemes investing more than fifteen per cent. (15%) in unlisted securities, shall be USD 10,000: Provided that a close-ended scheme shall not invest more than fifty per cent. (50%) in unlisted securities: Provided further that the minimum amount of investment of USD 10,000 and the cap of fifty per cent. (50%) shall not be applicable in case of investment by close-ended retail scheme in unlisted securities issued by an investment fund which is regulated by the concerned regulatory authority in its home jurisdiction, and is permitted for offering to retail investors in its home jurisdiction. (3) A Retail scheme shall not invest more than ten per cent. (10%) of its AUM in securities of a single company: Provided that a retail scheme may invest up to fifteen per cent. (15%) in a single company with the prior approval of the fiduciaries: Provided further that the limit on investment in single company in case of sectoral or thematic or Index schemes shall be the weightage of that company in the representative index, provided by an independent entity, that such scheme intends to benchmark with, or 15%, whichever is higher: Provided also that fund of funds schemes shall be permitted to invest in other scheme(s) if such scheme(s) meets the requirement under this regulation. (4) Retail schemes shall not invest more than twenty-five per cent. (25%) of its AUM in a single sector: Provided that in case of financial services sector, the amount shall not exceed fifty per cent. (50%) of the AUM of the scheme: Provided further that the limit on sectoral caps shall not apply in case of a sectoral or thematic or an Index Scheme: 33[Provided also that in case of a fund of funds scheme, the limit on sectoral cap shall not be applicable if such scheme is investing in other scheme(s) which are regulated by the concerned regulatory authority in their home jurisdiction(s) and are permitted for offering to retail investors in their home jurisdiction(s).] (5) A Retail scheme shall not invest more than twenty-five per cent. (25%) of the AUM in its associate: Provided that this restriction shall not be applicable in case of fund of funds schemes which have made disclosure in the offer document regarding the details of the underlying scheme(s) wherein the investments are intended to be made and the nature of association, if any, that the FME has with the manager(s) of the underlying scheme(s). (6) The minimum size of the retail schemes shall be USD 3 Million: Provided that an open-ended scheme may commence its investment activities upon receiving at least USD 1 Million from investors and it shall receive at least USD 3 Million from investors within 12 months from the date of communication from the Authority, that the offer document has been taken on record: Provided further that if a FME fails to achieve the minimum investment within the specified time, it shall have a one-time option to extend the validity of the offer document for a further period of 6 months by paying 50 per cent. (50%) of the fee as applicable for filing of a fresh scheme.