Dec 31, 2022

Schemes of AIFs Which Have Adopted Priority in Distribution Among Investors

SEBI has by way of its Circular dated November 23, 2022, clarified that it is currently examining the priority distribution model adopted by certain schemes of AIFs wherein a class of investors (other than the sponsor/manager) share losses more than pro rata to their holding in the AIF in comparison to other classes of investors/unit holders since the latter have priority in distribution over the former. Further, SEBI has directed that such schemes should not accept any fresh commitments or make investments in a new investee company till a view is taken by SEBI on the matter.




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