Removal of Initial issue expenses of Closed Ended MFs

31 Jan 2008

Currently close-ended schemes are permitted to charge initial issue expenses and not charge entry load. In order to bring in more transparency and clarity to the investors in terms of the expenses charged to them in closed-end schemes, SEBI Board in a recent meeting decided as under:



1. Henceforth, there will not be any provision of charging initial issue expense and amortization of the same.



2. All mutual fund schemes shall now meet the sales, marketing and other such expenses connected with sales and distribution of schemes from the entry load.



This circular would be applicable to all mutual fund schemes launched after the date of the circular.