What are Registration Requirements of a PMS Portfolio Manager?

• Obtaining Certificate of Registration from SEBI is mandatory.

• The application for certificate needs to made to SEBI with non-refundable fee.

• The application needs to be made in Form A of Schedule I.

Information Required in Form A

• Particulars of the applicant : Name, PAN, Address, Contact Details

• Organization Structure : Date & Place of Incorporation, Status of the Applicant, Organization Chart, Key Management Personnel. Particulars of the Directors, Partners, Promotors, Compliance Officer, Principal Officer. Information of work, experience, shareholding, employees, company activities, major shareholders.

• Business Plan : History, Events & Activities. Business Plan and Path.

• Infrastructural Facilities : Office Space & Equipment. Furniture, Communication Facilities, Data Processing Capacity, Computer Facility, Business Continuity Plan.

• Financial Information : Capital Structure, Net Worth of Applicant, Deployment of Resources, Major Sources of Income & Net Profit for recent 3 years. Particulars of Principal Banks & Auditors.

• Other Information : Details of all Disputes, Indictment of involvement in any economic offences in the last 3 years. Details of membership with recognized Stock Exchanges, Any other information related to the services rendered by the company.

• Business Information : Type of Activity, Decision making facilities, risk profiling procedure, grievance redressal and dispute resolution mechanism, list of approved share brokers, accounting system, research & database facilities, activities proposed to be outsourced.

• Additional Information : Draft Agreement, Details of Custodian and Registration with Regulatory Bodies.

• Experience : Experience in Financial Services Rendered.

• Declaration : Declaration of compliance with Regulation 7(2) signed by at least two directors or designated partners. Declaration of Fit and Proper Person. Declaration of compliance with clause 12(b) of Schedule III of the regulations. Declaration of compliance with SEBI circular on fees and charges. Declaration of type and frequency of reports proposed to be sent to clients. Declaration of time taken for transfer of securities into client accounts. Declaration of submission of periodic reports and Disclosure Document to SEBI. Declaration of compliance with clause (e) of sub-regulation (1) of Regulation 27 regarding maintenance of records for Investment Rationale. Declaration of availability of Disclosure Document on website of portfolio manager.

SEBI

Registration Requirement of PMS : Role of Regulator

The application or its principal officer if required, need to appear before the regulator for personal representation. Before issuing certificate of registration, the regulator will ensure registration requirement of PMS, such that, (Structure & Management, Educational Qualification & Experience, Morality)

• The applicant is a body corporate.

• The applicant has the necessary infrastructure, like office space & manpower.

• The applicant has appointed a compliance officer.

• The principal officer of the applicant has a professional qualification in finance, law, accountancy or business management from a Indian or foreign university or an institution recognized by central or state government. Alternatively, he can have completed a post graduate program in the securities market (portfolio management) from NISM for the duration of more than 1 year. Also, He can have obtained a CFA charter from the CFA institute.

• The principal officer has the experience of more than 5 years in the securities market related activities, like portfolio manager, stock broker, investment advisor, research analyst or a fund manager.

• Apart from principal officer and compliance officer, the applicant should have at lease 1 more employee who has above educational qualification and experience.

• The principle officer has the relevant NISM certification as specified by SEBI from time to time.

• Any disciplinary action has been taken by SEBI against a person directly or indirectly connected with the applicant.

• The applicant fulfills 5 Cr Rs net worth requirement.

• The applicant, its director or partner, principal officer, compliance officer or the employee has at any time been convicted for moral turpitude or economic offence or has been involved in litigation connected with the securities market that has the adverse bearing on the business of the applicant.

• The applicant is a fit and proper person.

• The grant of certificate to the applicant is in the interest of the investors.

The certificate of registration granted shall be valid unless it is suspended or cancelled by SEBI.