Securities and Exchange Board of India (SEBI) has issued circulars for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) on November 13, 2024, effective immediately, outlining the following amendments:
- The following lock-in and eligibility restrictions, applicable in case of allotment of units under preferential issue guidelines, shall not apply to units allotted to an employee benefit trust under a unit-based employee benefit scheme:
- i. Lock-in Period: Units allotted to individuals other than the sponsors shall be locked-in for one year from the date of trading approval. Additionally, any pre-preferential issue holdings of the allottees will be locked-in for six months from the trading approval date.
- ii. Eligibility for Preferential Allotment: No preferential issue of units will be made to individuals who have sold or transferred units in the 90 trading days prior to the relevant date.
- SEBI has authorized Indian REITs Association (for REITs) and Bharat InvITs Association (for InvITs) to prescribe formats for compliance certificate under Regulation 9(3) and quarterly compliance report under Regulation 10(18) of respective regulations to be submitted by the Manager/ Investment Manager with the REIT/ InvIT Trustee. Once prescribed, REITs and InvITs shall have to comply with the same.
- With regard to the amendments made to the distribution timelines on September 27, 2024, SEBI has revised the language in the paragraphs concerning the timeline for the transfer of unclaimed/ unpaid distributions by Manager/ Investment Manager, with a view to align the same with the respective regulations.
Below are the links to the Circulars for quick reference –