Portfolio managers must adhere to strict timelines for grievance redressal. This article explains the 21-day mandate and compliance requirements.
The Regulatory Mandate
Legal Basis
The portfolio manager shall take adequate steps for redressal of grievances of the investors within twenty-one calendar days of the date of the receipt of the complaint and keep the Board informed about the number, nature and other particulars of the complaints received.
Scope
The 21-day mandate applies to:
- All complaints received from investors
- Both SCORES complaints and direct complaints
- All types of grievances
Timeline Requirements
21 Calendar Days
Complaints must be resolved within 21 calendar days from the date of receipt.
Calculation
The timeline is calculated from:
- The date the complaint is received by the portfolio manager
- For SCORES complaints, the date the complaint is forwarded to the portfolio manager
What Must Be Done
Acknowledgment
Acknowledge receipt of the complaint promptly.
Investigation
Investigate the complaint thoroughly.
Resolution
Resolve the complaint and communicate the resolution to the complainant.
Reporting
Keep SEBI informed about:
- Number of complaints received
- Nature of complaints
- Resolution status
- Any delays
Compliance Requirements
Internal Procedures
Portfolio managers must have:
- Internal grievance redressal procedures
- Designated person/employee for handling complaints
- Clear escalation process
- Documentation of grievance redressal
Record Keeping
Maintain records of:
- All complaints received
- Resolution provided
- Timeline of resolution
- Communication with complainant
Reporting to SEBI
Report to SEBI on:
- Number and nature of complaints
- Resolution status
- Any delays in resolution
Consequences of Non-Compliance
Regulatory Action
Failure to comply with the 21-day mandate can result in:
- Enforcement action by SEBI
- Monetary penalties
- Suspension or cancellation of registration
Investor Impact
Delays in grievance redressal can lead to:
- Investor dissatisfaction
- Escalation to SCORES
- Regulatory scrutiny
SCORES Integration
SCORES Complaints
SCORES complaints must also be resolved within 21 calendar days.
Two-Level Review
SCORES 2.0 operates through a two-level review process:
- First Level: Review by RAASB
- Second Level: Review by SEBI
Tracking
Complaint status can be tracked on SCORES.
Complaint Data Disclosure
Monthly Website Disclosure
All Portfolio Managers on a monthly basis shall disclose on their websites, the data pertaining to all complaints including SCORES complaints received by them in the specified format. The information shall be made available by 07th of the succeeding month.
Format
The complaint data includes:
- Pending at the end of last month
- Received during month
- Resolved during month
- Total pending
- Pending complaints > 3 months
- Average resolution time
Expert Legal Guidance
Anuj Desai & Associates provides expert legal advisory services on grievance redressal compliance for portfolio managers. Our securities law experts help clients establish compliant grievance procedures, meet the 21-day mandate, and ensure regulatory compliance. Contact us for guidance on grievance redressal and other regulatory matters.