Portfolio Management Service (PMS) Registration Guide

March 07, 2024

Overview

A Portfolio Manager is a body corporate that manages, advises, or administers a portfolio of securities or funds on behalf of clients. PMS can be discretionary or non-discretionary:

Eligibility Criteria

To register as a Portfolio Manager, the applicant must meet the following conditions:

Criteria	Details
Body Corporate	The applicant must be a registered entity.
Infrastructure	Adequate office space, equipment, and manpower.
Compliance Officer	Must appoint a qualified compliance officer.
Principal Officer	Must be qualified in finance, accountancy, business management, law, or have relevant experience or certifications.
Employee Qualifications	At least one employee with a graduate degree and 2 years of securities market experience.
Net Worth	Minimum of ₹5 crore.
Fit and Proper	Applicant must meet SEBI’s “fit and proper person” criteria.
No Disciplinary Action	No adverse action under securities laws.

Registration Process

1. Application Submission:

   • Fill Form A (available on SEBI’s website).

   • Pay a non-refundable application fee of ₹1,00,000 via demand draft to “Securities and Exchange Board of India” payable at Mumbai.

2. Review by SEBI:

   • SEBI examines the application.

   • Applicants may need to furnish clarifications or attend a personal representation.

   • Incomplete applications may be rejected after granting a 3-week rectification window.

3. Approval and Registration Fee:

   • Upon approval, pay ₹10,00,000 as the registration fee.

   • Receive the Certificate of Registration.

4. Certificate Validity:

   • Valid for 3 years.

   • Renewal application and ₹5,00,000 fee must be submitted 3 months before expiry.

Key Obligations

Obligation	Details
Client Agreement	Enter into a written agreement outlining roles, responsibilities, and fees.
Minimum Investment	Accept funds or securities worth at least ₹50 lakhs.
Demat Account	Clients must open a demat account for investing in listed securities.
Reporting	Provide periodic reports (at least semi-annual) on portfolio performance and transactions.
Disclosure Document	Provide a document detailing fees, risks, and other terms at least 2 days before contract signing.

Checklist for Application

Document/Information	Details
Compliance and Principal Officer Details	Qualifications, PAN, and experience.
Registered Office and Principal Business Address	Proof of address (rent agreement, utility bills, etc.).
Incorporation Certificate	Certificate of incorporation or registration documents.
Organizational Structure	Diagram showing functional activities and roles.
Financial Documents	Audited financials, business plan (3 years), and net worth certificate from statutory auditor.
Disclosure Document	Draft agreement and disclosures as per SEBI guidelines.

Fees Overview

Fee Type	Amount (₹)	Description
Application Fee	1,00,000	Paid during initial application submission.
Registration Fee	10,00,000	Paid after SEBI approval for the grant of certificate.
Renewal Fee	5,00,000	Paid for renewal of registration every 3 years.

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Disclaimer

This guide provides a general overview of the PMS registration process and related requirements. For the latest updates and detailed guidelines, please refer to SEBI's official website (www.sebi.gov.in). This information is not intended for legal purposes and should not be relied upon as legal advice.