SEBI cancels registration of 19 foreign venture capital investors over violations

India’s market regulator, the Securities and Exchange Board of India (SEBI), has cancelled the registration of 19 Foreign Venture Capital Investors (FVCIs), citing regulatory violations. These entities, based in countries like Mauritius, Singapore, and Cyprus, were found to be defunct and in breach of SEBI norms.

SEBI’s investigation revealed that 14 of these entities had officially ceased operations, with 11 being defunct for over five years, while three had shut down between 10 months and three years ago. The regulator had issued show-cause notices in December 2024, but none of the entities responded.

No Securities Held in India

According to reports from custodians, these FVCIs did not hold any securities in India. SEBI also found that they failed to meet key registration requirements, including:

No longer being legally incorporated outside India

Failing to submit quarterly reports

Not informing SEBI of changes in their eligibility criteria

In its order, SEBI emphasized that these investors were required to disclose their inactivity since it is considered material information. The show-cause notice further alleged that several entities were missing from their registered addresses, indicating that they failed to notify SEBI of address changes or submit mandatory filings under FVCI regulations.

Some of the impacted FVCIs include:

Blackstone Capital Partners (Singapore) VI FVCI

Axis Capital Mauritius

IFCI Sycamore India Infrastructure Fund

Blackstone Family Investment Partnership (Singapore) VI-ESC FVCI

Summit Partners India Venture Capital Investments

This crackdown highlights SEBI’s strict stance on regulatory compliance and transparency in the financial sector.