In order to avoid misuse of framework for incentivizing distributors for new investment/ inflows from beyond top 30 cities (B-30 cities), SEBI has revised the incentive structure for distributors for bringing in new investment / inflows in the Mutual Funds. Accordingly, the mutual fund distributors shall be eligible for additional commission in the following manner –

Eligible Investments: -

1. New individual investors (new PAN) from B-30 cities, at the mutual fund industry level

2. New women individual investors (new PAN) from both Top 30 and B-30 cities

Incentive Structure: -

The additional distribution commission shall be paid from the 2 basis points on daily net assets, mandated to be set apart annually by AMCs for investor education, awareness and financial inclusion initiatives, subject to adequate claw back provisions

Payment of additional distribution commission, shall be mandatory for all schemes of a mutual fund, except Exchange Traded Funds (ETFs), Fund of Funds (domestic) with more than 80% of Assets Under Management (AUM) invested in domestic funds and Schemes having duration requirement of less than one year.

To facilitate enhanced participation by the Mutual Funds and Specialized Investment Funds (SIFs) in Real Estate Investment Trusts (REITs) and with respect to notification for reclassification of REITs as equity related instruments, following is decide by SEBI that with effect from January 01, 2026, any investment made by Mutual Funds and SIFs in REITs shall be considered as investment in equity related instruments. InvITs shall continue to be classified as hybrid instruments for the purpose of investments by Mutual Funds and SIFs. With respect to existing investment in REITs held by debt schemes of Mutual Funds and investment strategies of SIFs as on December 31, 2025, shall be grandfathered.

AMCs are encouraged to make efforts to divest REITs from respective portfolios of debt schemes considering the market conditions, liquidity and interest of investors.

a) SEBI vide amendment notification dated 18th November 2025 has introduced scale-based threshold mechanism for approval of related party transaction from Audit Committee.

Materiality threshold as specified in SEBI (LODR), Regulations

b) Threshold for RPTs of subsidiary

Earlier RPTs exceeding a threshold of 10% of the standalone turnover of the subsidiary are considered as Significant RPTs, thus, requiring approval of the Audit Committee of the listed entity. RPTs of subsidiary now would require listed holding company’s audit committee approval if they breach the lower of following limits:

1. 10% of the standalone turnover of the subsidiary or

2. Material RPT thresholds as applicable to listed holding company

As per provisions of regulation 12 of the Securities and Exchange Board of India Act, 1992, all registered Intermediaries are required to abide by the code of conduct under respective regulations. In order to increase transparency in the securities market and protect the interest of investors, SEBI vide consultation paper proposed compliance with respect to uploading content on social media platforms as mentioned below: -

1. Information/disclosures in the social media content: All persons regulated by the Board and their agents (mutual fund distributors, distributors of portfolio management services etc) shall prominently disclose their registered name and registration number on the home page of their social media channels as well as alongside each of the videos/content uploaded by them so that the viewer/user is able to identify that the content uploaded on the SMP(s) is uploaded by a SEBI regulated entity or its agent

2. Prohibitions in the social media content: All regulated entities and their agents shall ensure that the social media content published by them do not contain anything, which is prohibited for publication under the law; statements which are false; misleading; biased or deceptive, statements which, directly or by implication or by omission, may mislead the investor; statement designed to exploit the lack of experience or knowledge of the investors; any statement that is exaggerated or is inconsistent with or unrelated to the nature and risk and return profile of the product being talked about/referred in the content; promise or guarantee of assured or risk free return to the investors either in directly or in an implied manner; Reference to past performance of the entity unless permitted by SEBI to make such reference; SEBI Logo/ reference to any SEBI office or officer; References/ links (directly or indirectly) or any association (direct/indirect) with any other person who, directly or indirectly, provides advice or recommendation, in respect of or related to security (ies) or makes any implicit or explicit claim of return or performance, in respect of or related to security (ies) unless permitted by the Board to provide such advice/ recommendation/claim

Also, SEBI has proposed that, if anything contained in the social media content is either expressly or in an implied manner, in the nature of promotion of the regulated entity or products or services offered by the regulated entity, such contents shall be considered as an advertisement and shall be required to be in compliance with the provisions of Advertisement Code, if any, applicable for such entity