New Delhi: The Securities and Exchange Board of India (SEBI) has eased compliance requirements for Foreign Portfolio Investors (FPIs), extending the periodicity of their Know Your Customer (KYC) reviews to up to eight years. The move is aimed at reducing repetitive compliance requirements and promoting ease of doing business.
Under the revised framework, the frequency of KYC reviews will depend on the FPI’s category, risk classification, jurisdiction and regulatory status.
Revised KYC Review Periods
The revised schedule provides for the following review periods:
Category I FPIs: Entities operating in high-risk jurisdictions will undergo KYC reviews every eight years, while other entities in this category will be subject to reviews every two years.
Category II FPIs: Those operating in high-risk jurisdictions will undergo reviews every two years.
Category II FPIs in non-high-risk jurisdictions: Regulated entities will have an eight-year review cycle, while other entities will be subject to reviews every two years.
SEBI said FPIs are currently subject to periodic KYC reviews annually or once every three years, depending on their category and other applicable criteria. The revised framework extends these intervals from one year to two years and from three years to eight years.
Exemptions and Other Compliance Changes
The existing provisions for Government Securities (GS)-only FPIs and SWAGAT-FI FPIs will remain unchanged.
KYC reviews for GS-only FPIs will continue according to the periodicity applicable to their respective bank accounts, as prescribed by the Reserve Bank of India (RBI). For SWAGAT-FI FPIs, the review period will remain 10 years.
SEBI has also discontinued the requirement for FPIs to separately intimate changes in information submitted earlier or provide a no-change declaration at the time of continuation of registration.
According to the regulator, the changes are intended to rationalise overlapping requirements, reduce repetitive compliance and ease the regulatory burden on FPIs.
The revised provisions will come into effect from December 1, 2026.
