SEBI has changed the investment rules related to junior employees of mutual fund houses. It has been announced to implement the “Skin in the Game” rule in a phased manner for them.
New Delhi . Market regulator SEBI has changed the investment rules related to junior employees of mutual fund houses. It has been announced to implement the “Skin in the Game” rule in a phased manner for them. Under the changed rule, 10% of the salary of these employees will now be invested in that fund down mutual fund unit.
At the same time, from October 1, 2022, 15% of his salary will be invested in buying mutual fund units. Whereas from October 1, 2023, 20 percent of the salary will be invested in mutual fund units. SEBI said that this “skin in the game” rule will be applicable from 1 October 2022.
What is the “skin in the game” rule?
“Skin in the game” is the situation in which the owner of a company or other employees with high salary starts buying shares of his own company. SEBI has also given the definition of Junior Employee for this rule. Under this, those employees whose age is less than 35 years and who are not heading any department.
20% of salary will have to be invested from October 1
With this rule of SEBI, even the CEO and fund manager of the fund house have not been given a thought. Under the rules, from October 1, 2021, 20% of the salary of these employees will be invested in mutual fund units. Also, there will be a lock-in period of three years on this investment.
At the same time, the “designated” employees of the fund house have also been given the facility to adjust their existing investments in it. In this way, the take-home salary of these employees will not be affected, but from October 2021, their investment will be locked for three years.
SEBI fines eight entities
Videocon Industries Ltd. by SEBI. Eight entities have been fined for fraudulent trading in shares of Rs. These entities are – AQT Merchants Pvt Ltd., Godavari Commercial Services Ltd., Kaveri Goods Pvt Ltd., Invorex Vincom Pvt Ltd., Coastal Fertilizers Ltd., Akanksha Commodities Pvt Ltd., M/s Agarwal Holdings and Superdeal Fincom Pvt Ltd.
These units will have to jointly pay a fine of Rs 16 lakh for fraud and violation of unfair trade practices ban rules. SEBI has given this order after its investigation of April-September 2017. SEBI said in its order that the investigation has brought to the fore the fact that these entities linked to each other were trading during the period of investigation.
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