Exchange Traded Funds

61. (1) Only Registered FMEs (Retail) may launch Exchange Traded Funds (ETFs) by filing the draft offer document with the Authority along with the applicable fees, at least twenty-one (21) working days before its launch. (2) The validity of the offer document for the launch of the ETF shall be twelve (12) months from the date of communication from the Authority to the FME that the offer document has been taken on record. Explanation.- For the purpose of the Income Tax Act, 1961, the communication received by the FME from the Authority that the offer document has been taken on record, shall be construed as Certificate of Registration. (3) The FME shall ensure that the comments of the Authority are duly incorporated in the offer document prior to launch of the ETF. (4) The FME shall ensure that any material changes from the information provided in the draft offer document are informed to the Authority immediately. (5) ETF shall be mandatorily listed and traded on a recognised stock exchange and shall include: (a) Equity Index based ETFs; (b) Debt Index based ETFs; (c) Commodity based ETFs; (d) Hybrid ETFs (investing in 2 or more asset class); (e) Actively Managed ETFs; (f) Any other ETFs subject to approval of the concerned recognised stock exchange and the Authority. (6) No offer document of an ETF shall be filed with the Authority unless it has been approved by the fiduciaries: Provided that in case of ETFs falling under clauses (e) and (f) of sub-regulation (5) above, prior approval of recognised stock exchange(s) where such ETF is intended to be listed, shall be obtained. (7) An ETF in IFSC shall use the identifier ‘IFSC ETF' which identifies it as an ETF listed and traded on recognised stock exchanges, and shall be used at all places including in its name, offer document, and all advertising material.