Chapter VI-A · Power to Relax Strict Enforcement
Regulation 35A
Exemption from enforcement of the regulations in special cases
Chapter VI-A · Power to Relax Strict Enforcement
SEBI (Alternative Investment Funds) Regulations, 2012
In plain English
In plain English
SEBI can exempt a person or class of persons from all or any of these regulations, for a period not exceeding twelve months, to further innovation such as testing new products, processes, services or business models.
Where this sits
Regulation 35A is in Chapter VI-A — Power to Relax Strict Enforcement of the SEBI (Alternative Investment Funds) Regulations, 2012.
Provisos, explanations and conditions
Quoted from the regulation text. These qualify or carve out exceptions to the main rule.
Explanation. —For the purposes of these Regulations , "regulatory sandbox" means a live testing environment where new products, processes, services, business models, etc. may be deployed on a limited set of eligible customers for a specified period of time, for furthering innovation in the securities market, subject to such conditions as may be specified by the Board.] MISCELLANEOUS
What changed
No change to this regulation by the 2026 amendments (No. 303 of 16 April 2026 and No. 313 of 10 July 2026).
Words in square brackets in the official text mark earlier amendments made before 2026. Their earlier wording is not shown because it has not been verified here.
Where it connects
The text of this regulation does not refer to other numbered regulations.
Chapter
Check yourself
1 practice question on Regulation 35A, each with an explanation for every option.
- For how long can SEBI exempt a person from these regulations to further innovation?
The regulation
35A. (1) The Board may, exempt any person or class of persons from the operation of all or any of the provisions of these regulations for a period as may be specified but not exceeding twelve months, for furthering innovation[***] relating to testing new products, processes, services, business models, etc. in live environment of regulatory sandbox in the securities markets.
(2) Any exemption granted by the Board under sub-regulation (1) shall be subject to the applicant satisfying such conditions as may be specified by the Board including conditions to be complied with on a continuous basis.
Explanation. —For the purposes of these Regulations , "regulatory sandbox" means a live testing environment where new products, processes, services, business models, etc. may be deployed on a limited set of eligible customers for a specified period of time, for furthering innovation in the securities market, subject to such conditions as may be specified by the Board.] MISCELLANEOUS
Text from the consolidated Regulations. Square brackets and [***] mark earlier amendments and omissions, as in the official text. Check the official Gazette text before relying on it.
Last checked against source on 10 October 2026: consolidated Regulations to 19 November 2025, read with Amendment Regulations No. 303 (16 April 2026) and No. 313 (10 July 2026).
Source and verification
- Instrument
- SEBI (Alternative Investment Funds) Regulations, 2012 — Regulation 35A
- Text used
- Consolidated Regulations as amended up to 19 November 2025, read with the 2026 amendments (no change to this regulation)
- Last checked
- 10 October 2026
- Official source
- www.sebi.gov.in → Legal → Regulations. The Gazette text prevails.
Work with Prashant Kumar
Structuring or running an AIF?
Advice on registration, PPM filing, investor on-boarding and ongoing compliance under the AIF Regulations.