The Securities Exchange Board of India ("SEBI") through SEBI (Infrastructure Investment Trusts) (Third Amendment) Regulations, 2023 bearing notification no. SEBI/LAD-NRO/GN/2023/159 ("Notification 1") and SEBI (Real Estate Investment Trusts) (Third Amendment) Regulations, 2023 bearing notification no. SEBI/LAD-NRO/GN/2023/160 ("Notification 2") ("Notifications"), dated and in force since October 20, 2023, has amended the SEBI (Infrastructure Investment Trusts) Regulations, 2014 ("InvIT Regulations") and (Real Estate Investment Trusts) Regulations, 2014 ("REITs Regulations") respectively. The Notifications amended Regulation 18(6) of the InvIT Regulations and Regulation 18(16) of the REITs Regulations.
Regulation 18(6)(e) of the InvIT Regulations and Regulation 18(16)(f) of the REITs Regulations provide that any amount which is unpaid or unclaimed out of the distributions declared by an InvIT/REIT as per Regulation 18, shall be transferred to the Investor Protection and Education Fund ("Fund") constituted by the SEBI, in such manner as may be specified by the board.
The Notifications inserted a proviso to the above Regulation 18(6)(e) and Regulation 18(16)(f) stating that the amount transferred to such Fund shall not bear any interest. Further, Notification 1 inserted sub-clause (f) in Regulation 18(6) of the InvIT Regulations which provided that the unclaimed or unpaid amount of a person that has been transferred to the Fund in terms of sub-clause (e), may be claimed in such manner as may be specified. Notification 2 also inserted a similar sub-clause (g) in Regulation 18(16) of the REITs Regulations stating the above. This amendment has enabled the unit holders/InvIT/REIT to reclaim the unclaimed or unpaid distribution amount which was previously not provided for.
Please find a copy of the Notifications, here and here.
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