Financial Regulatory Quarterly Milestones (October-December 2025)

On 18 November 2025, the Securities and Exchange Board of India (SEBI) introduced the SEBI (Informal Guidance) Scheme, 2025 (IG Scheme 2025). IG Scheme 2025 came into effect on 1 December 2025, replacing the erstwhile SEBI (Informal Guidance) Scheme, 2003 (IG Scheme 2003).

SEBI has widened access to its informal guidance mechanism by extending the ambit of eligible applicants beyond those permitted under the IG Scheme 2003, which included SEBI-registered intermediaries, listed companies, companies proposing to list their securities, and acquirers or prospective acquirers under the takeover regulations, to now include managers or trustees of SEBI-registered pooled investment vehicles, recognised stock exchanges, clearing corporations, and depositories.

Applications under the IG Scheme 2025 must be disposed of within 60 days of receipt, excluding any time taken for clarifications. Further, applicants may either request (a) confidential treatment for a period of 90 days, or (b) redaction of commercially secretive information. If the applicant’s request for confidentiality or redaction is rejected, the applicant may withdraw the application within 30 days of receipt of the advice and thereafter be entitled to a full refund.

The IG Scheme 2025 underscores SEBI’s commitment to strengthen regulatory clarity by institutionalising a more structured, time-bound, and accessible informal guidance framework. By broadening the class of eligible applicants and introducing a redaction mechanism for commercially sensitive information, the revised scheme is likely to reduce interpretational uncertainty under SEBI’s regulatory regime.

On 3 December 2025, SEBI notified the SEBI (Merchant Bankers) (Amendment) Regulations, 2025 (Amendment Regulations), which came into effect on 3 January 2026, marking a significant shift from the SEBI (Merchant Bankers) Regulations, 1992 (MB Regulations).

Under the MB Regulations, a uniform minimum net worth of INR 5 Crore applied previously for registration as a Merchant Banker (MB) under the MB Regulations. SEBI has now moved to a tiered, category-specific net worth regime, as set out below:

In contrast to the earlier regime, which did not expressly enumerate permitted activities, the Amendment Regulations set out a list of permitted activities for MBs, including managing capital markets issuances, acquisitions and takeovers under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, and private placements relating to listed or proposed-to-be listed securities.

The Amendment Regulations prohibit MBs from outsourcing their core activities, which are specifically identified as due diligence, preparation of offer-related documents, and any other activities as may be specified by SEBI.

The Amendment Regulations reflect SEBI’s intent to modernise and evolve the regulatory framework governing MBs by clearly delineating the scope of permitted merchant banking activities and introducing revised capital adequacy requirements. Through these amendments, SEBI aims to enhance accountability and strengthen the integrity of the MB framework.

On 17 December 2024, SEBI issued a circular mandating additional disclosure requirements for certain offshore derivative instruments (ODI) subscribers (ODI Circular). Under the ODI Circular, ODI subscribers meeting any of the following criteria were required to either (a) provide granular details of all entities holding any ownership, economic interest, or exercising control in the ODI subscriber, on a full look through basis up to the level of all natural persons, without any threshold; or (b) realign their positions within the prescribed timelines:

The ODI Circular further required depositories, designated depository participants/custodians and ODI issuing FPIs to prepare a Standard Operating Procedure (SOP) setting out a detailed mechanism for independently validating the ODI subscribers’ conformance with the granular disclosure requirements. The SOP was intended to standardise the processes followed by the market intermediaries in relation to ODI issuance and compliance with the enhanced disclosure framework.

Accordingly, in advance of the operationalisation of the ODI Circular on 17 December 2025, SEBI notified the SOP on 23 October 2025. The SOP sets out the framework and operational processes relating to:

The SOP reinforces SEBI’s recent stance of ensuring effective regulatory oversight over concentrated and significant foreign positions, both direct and indirect, in the Indian securities market. The framework brings ODI subscribers, in respect of disclosure, monitoring and accountability, much closer to the regulatory expectations applicable to FPIs.

On 17 November 2025, the International Financial Services Centres Authority (IFSCA) issued a circular under the IFSCA (AML/CTF/KYC) Guidelines, 2022 (AML Guidelines), mandating all Designated Directors (DD) and Principal Officers (PO) of Regulated Entities (RE) to complete a customised certification course – ‘NISM-IFSCA-01: Certification Course on Anti-Money Laundering and Counter-Terrorist Financing in the IFSC’ (Certification Course) developed by the National Institute of Securities Market (NISM) in collaboration with the IFSCA Academy. The course was launched on 18 November 2025, and DDs and POs of REs are required to complete it within four months of its launch, i.e., 18 March 2026, or within four months from the date of their appointment, as applicable. Additionally, when employed with the REs, the DDs and POs are required to hold the said certification at all times while discharging their responsibilities under the AML Guidelines.

Under the AML Guidelines, an RE is defined as a unit or entity which has been granted a license, recognition, registration or authorisation by the IFSCA. Given that entities may operate within IFSCA’s framework only upon approval or recognition by the IFSCA, the scope of the definition of REs extends to all entities established within the IFSCA framework. Consequently, the certification requirement applies broadly to DDs and POs of all entities regulated or authorised by IFSCA and non-completion of the Certification Course within the prescribed timeline would constitute non-compliance with the AML Guidelines read with the IFSCA circular.