SEBI on Thursday issued a circular simplifying certain requirements for grant of “accredited investor” status, aimed at smoothing onboarding for Alternative Investment Funds (AIFs) and recognised accreditation agencies. 

Pending receipt of the accreditation certificate, an AIF’s investment manager can, based on its own assessment of an investor’s eligibility, finalise/execute the contribution agreement and begin related operational procedures. 

 However, SEBI has ring-fenced prudential norms tied to scheme corpus: any commitment from such an investor cannot be counted in the scheme corpus until the formal certificate is obtained. 

 Further, the scheme can receive funds from the investor only after the accreditation certificate is issued. 

For accreditation based on net-worth, SEBI has done away with the requirement to submit a detailed break-up of net worth as an annexure to the net-worth certificate. 

It also clarified that it is optional for the chartered accountant to mention the actual net worth figure while certifying that the specified threshold is met. 

AIF trustees/sponsors/managers must ensure the Compliance Test Report captures adherence to this circular. 

 The circular takes effect immediately.