SEBI eases FPI KYC rules, extends review period to 8 years; check new norms effective December 1

The Securities and Exchange Board of India (SEBI) has relaxed Know Your Customer (KYC) requirements for Foreign Portfolio Investors (FPIs), extending the periodicity of KYC reviews to up to eight years from the existing one to three years.

The revised framework is aimed at reducing compliance requirements for FPIs and promoting ease of doing business. The new provisions will come into effect from December 1, 2026.

SEBI, in its circular dated October 30, 2026, said, "With a view to rationalise these requirements, reduce compliance burden and promote Ease of Doing Business, it has been decided" to increase the periodicity of KYC reviews and remove certain requirements relating to continuation of registration.

SEBI revises FPI KYC review period

Under the revised framework, the frequency of KYC reviews will depend on the jurisdiction, category and regulatory status of the FPI.

The revised review periods are as follows:

• Category I FPIs in high-risk jurisdictions: Every eight years for entities registered under Regulation 5(a)(i) and every two years for others.
• Category II FPIs in high-risk jurisdictions: Every two years.
• Category I FPIs in non-high-risk jurisdictions: Every eight years.
• Category II FPIs in non-high-risk jurisdictions: Every eight years for regulated entities and every two years for others.

Explaining the change, SEBI stated in its circular: "To increase the periodicity of KYC review of FPIs."

The revised framework extends the review period from one year to two years and from three years to eight years, depending on the applicable category and other criteria.

Existing rules for GS-FPIs and SWAGAT-FI to continue

SEBI has kept the existing KYC review provisions unchanged for FPIs investing only in Government Securities (GS-FPIs) and SWAGAT-FI FPIs.

For GS-FPIs, KYC reviews will continue according to the periodicity applicable to their respective bank accounts, as prescribed by the Reserve Bank of India (RBI).

For SWAGAT-FI FPIs, the KYC review period will remain 10 years.

SEBI removes no-change declaration requirement

Along with revising the KYC review schedule, SEBI has discontinued the requirement for FPIs to separately intimate changes in previously submitted information or furnish a no-change declaration at the time of continuation of registration.

The regulator stated that it had decided "to dispense with the requirements relating to intimation of change in information at the time of continuance of registration."

Under the revised provisions, FPIs wishing to continue their registration for the subsequent three-year block will have to pay the applicable fees to their Designated Depository Participants (DDPs). For SWAGAT-FI FPIs, the continuation period will remain 10 years.

FPIs must pay continuation fees 15 days before expiry

SEBI has specified that FPIs must pay the fees for continuation of registration at least 15 days before the expiry of their current registration.

The circular states that FPIs must pay the fees "at least 15 days prior to current validity of its registration in order to facilitate a smooth continuance process."

The regulator has directed depositories, custodians and DDPs to make the necessary changes to their systems and processes to implement the revised provisions and inform the concerned FPIs.