The Securities and Exchange Board of India (SEBI) has allowed portfolio managers to transfer their Portfolio Management Services (PMS) businesses, introducing a structured mechanism aimed at simplifying compliance and improving ease of doing business.
According to a circular issued on October 24, 2025, SEBI said that portfolio managers can transfer their PMS operations either to another manager within the same group or to one outside the group, but only after obtaining prior approval from the regulator.
For transfers within the same group, portfolio managers may shift either selected investment approaches or their entire PMS business. If the entire business is transferred, the transferor must surrender its registration certificate within 45 working days. In case only certain investment strategies are moved, the original manager may continue holding its registration.
For transfers outside the group, both the transferor and transferee must make a joint application to SEBI. In such cases, only a full transfer of the PMS business is allowed—partial transfers of select investment approaches are not permitted. The transferee must assume responsibility for all obligations, litigations, and pending actions of the transferor, supported by an undertaking. The entire process must be completed within two months of SEBI’s approval, during which the transferor may not onboard new clients and must surrender its registration once the handover is complete.
The circular takes effect immediately and has been issued under SEBI’s powers to protect investor interests and promote the development and regulation of the securities market.
