The Securities and Exchange Board of India (SEBI) regulates Portfolio Managers under the SEBI (Portfolio Managers) Regulations, 2020. Registration is mandatory for any body corporate seeking to provide portfolio management services. This guide outlines the complete step-by-step process for obtaining a SEBI Portfolio Manager certificate in 2026.
Understanding the Registration Framework
Who Must Register
Regulation 3 of the SEBI (Portfolio Managers) Regulations, 2020 provides that no person shall act as a portfolio manager unless it has obtained a certificate of registration from SEBI. A portfolio manager is defined as a body corporate which, pursuant to a contract with a client, advises or directs or undertakes on behalf of the client the management or administration of a portfolio of securities or goods or funds of the client.
Eligibility Criteria
Only a body corporate can apply for registration as a portfolio manager. This means that only a company (private or public) or a Limited Liability Partnership (LLP) is eligible. Individuals, partnership firms, and other structures are not permitted to register as portfolio managers.
Step 1: Ensure Minimum Qualification and Certification Requirements
Principal Officer Eligibility
The Principal Officer must possess a professional qualification in finance, law, accountancy, or business management from a recognized university or institution. Alternatively, a professional qualification by completing a Post Graduate Program in the Securities Market (Portfolio Management) from NISM or a CFA charter from the CFA Institute is also acceptable.
The Principal Officer must have experience of at least five years in related activities in the securities market, including as a portfolio manager, stock broker, investment advisor, research analyst, or as a fund manager. At least two years of this experience must be in portfolio management or investment advisory services or in areas related to fund management.
The Principal Officer must also hold the relevant NISM certification as specified by SEBI. The NISM-Series-XXI-B: Portfolio Managers Certification Examination is mandatory.
Compliance Officer
Every portfolio manager must appoint a senior officer as Compliance Officer. The Compliance Officer shall coordinate with regulatory authorities and ensure internal compliance. The role of Compliance Officer cannot be assigned to the Principal Officer.
Step 2: Meet the Net Worth Requirement
Regulation 9 of the PM Regulations mandates that the net worth of a portfolio manager shall not be less than five crore rupees. Net worth is defined as the aggregate value of paid-up equity capital plus free reserves (excluding reserves created out of revaluation) reduced by the aggregate value of accumulated losses and deferred expenditure not written off.
This net worth requirement must be maintained at all times throughout the period of registration. SEBI has emphasized that the ₹5 crore net-worth requirement is critical to ensure that only financially robust entities manage public funds, safeguarding investor interests.
Step 3: Prepare and Submit Form A
Application Form
The application for registration must be made in Form A of Schedule I. The applicant must submit a completed application form together with appropriate supporting documents to SEBI.
Required Documentation
The application must be accompanied by:
- Constitutional documents (Memorandum and Articles of Association or Partnership Deed)
- Business plan for three years
- Detailed profiles of the Principal Officer and Compliance Officer
- Financial statements and net worth certificate
- Infrastructure details including office space, equipment, and manpower
- Organization structure and details of directors/partners
Application Fee
The application must be accompanied by a non-refundable application fee of ₹1 lakh.
Step 4: Online Submission Through SEBI Intermediary Portal
All applications must be filed online through the SEBI Intermediary Portal at https://siportal.sebi.gov.in. The applicant is required to fill up all the details under the "Portfolio Manager" tab and submit the application after completing all sections.
Step 5: SEBI Scrutiny and Processing
Consideration of Application
SEBI considers all matters relevant to portfolio management activities. The Board examines whether:
- The applicant is a body corporate
- The applicant has necessary infrastructure like adequate office space, equipment, and manpower
- The applicant has appointed a Compliance Officer
- The Principal Officer meets qualification and experience requirements
- The applicant fulfills the net worth requirement
- The applicant, its directors, or officers are fit and proper persons
Furnishing Further Information
SEBI may require the applicant to furnish further information or clarification regarding matters relevant to the activity. The applicant or its Principal Officer may be required to appear before SEBI for personal representation.
Rejection of Incomplete Applications
Any application that is not complete in all respects and does not conform to the instructions specified in the form shall be rejected. However, before rejecting any such application, the applicant is given an opportunity to remove objections within the time specified, not later than 3 weeks.
Step 6: Grant of Certificate
Registration Fee
Upon being satisfied that the applicant fulfills the requirements, SEBI sends an intimation to the applicant. On receipt of payment of registration fees of ₹10 lakh, SEBI grants a certificate in Form B.
Certificate Validity
The certificate of registration is valid unless it is suspended or cancelled by SEBI. The certificate must be renewed every three years by payment of renewal fees of ₹5 lakh.
Step 7: Post-Registration Compliance
Conditions of Registration
After registration, the portfolio manager must:
- Abide by the provisions of the SEBI Act and PM Regulations
- Obtain prior approval of SEBI in case of change in control
- Inform SEBI in writing if any information previously submitted is found to be false or misleading
- Pay fees for registration in the manner provided
- Take adequate steps for redressal of grievances of investors within twenty-one calendar days
- Maintain the net worth specified in regulation 9 at all times
Commencement of Operations
Once the certificate is granted, the portfolio manager can commence portfolio management activities subject to compliance with all regulatory requirements.
Expert Legal Guidance
Anuj Desai & Associates provides comprehensive legal advisory services for portfolio manager registration and compliance. Our securities law experts help applicants navigate the registration process, prepare applications, and ensure ongoing compliance with SEBI regulations. Contact us for expert guidance on your portfolio manager registration journey.