AIF Application Process — SEBI Registration for Alternative Investment Funds | Nainit Savla & Associates

AIF Application Process — SEBI Registration

Registering an Alternative Investment Fund with SEBI is a formal, multi-step regulatory process that requires careful preparation, precise documentation, and effective management of the interaction with the SEBI regulator. An incomplete or inconsistent application typically triggers multiple rounds of queries and revisions — delaying the launch and increasing costs. Our AIF application support service manages the complete registration process from pre-application preparation to receipt of the SEBI Certificate of Registration, ensuring the smoothest possible path to launch.

Eligibility Assessment

Pre-application assessment of the fund manager's eligibility — key investment team credentials, track record requirements, fit and proper criteria, and adequacy of the sponsor's net worth commitment to the fund.

Form A Preparation

Preparation of the complete Form A application — the primary SEBI registration form for AIFs — with all required annexures, disclosures, and supporting documentation cross-checked for accuracy and consistency.

Placement Memorandum Drafting

Drafting of the Private Placement Memorandum (PPM) — the key disclosure document provided to investors — in compliance with the Third Schedule to the AIF Regulations and SEBI guidance notes.

SEBI Query Management

Monitoring of the application on the SEBI Intermediary Portal, responding to SEBI's queries and clarifications within the prescribed timelines, and managing the interaction with the SEBI regulatory team through to approval.

Trustee and Custodian Arrangements

Assistance in identifying and appointing a SEBI-registered trustee (for trust-structured AIFs) and custodian (mandatory for Category III AIFs and optional for Categories I and II) as required by the AIF Regulations.

Post-Registration Compliance Setup

Post-registration compliance framework setup — investor reporting templates, SEBI periodic reporting calendar, PPMS data submission setup, and first-close documentation preparation for investor onboarding.

SEBI AIF Registration Process — Step by Step

The AIF registration process begins with the selection of the fund manager / investment manager entity (which must be a body corporate), followed by preparation of the constitutional documents (trust deed, investment management agreement), the Private Placement Memorandum, and the Form A application package. The application is filed on the SEBI Intermediary Portal with a registration fee (currently ₹1 lakh for Category I and II; ₹5 lakh for Category III). SEBI typically responds within 21 working days with queries or approval. After addressing all SEBI queries, the Certificate of Registration is issued — after which the AIF can begin investor onboarding and fundraising. This process connects with fund structuring and AIF documentation as part of the complete AIF setup journey.

Key Eligibility Requirements for AIF Registration

The fund manager must be a body corporate (company or LLP) with adequate infrastructure and experienced key investment professionals
Key investment team must have relevant experience in fund management or investment advisory
Fit and proper criteria — no disqualification, disciplinary action, or conviction of key persons
Manager must contribute to the corpus — at least 2.5% of the corpus or ₹5 crore (whichever is lower) for Category I and II; ₹10 crore or 5% of corpus for Category III
Minimum corpus commitment — ₹20 crore total (₹10 crore for Angel Funds)
Compliance officer designation by the fund manager
Domestic vs offshore fund structure — onshore AIF vs Mauritius/Singapore GIFT City structure
GIFT City IFSC fund structure for funds targeting foreign investors and DTAA benefits

Frequently Asked Questions

What is the SEBI registration fee for an AIF?

The SEBI AIF registration fee depends on the category: Category I AIF — ₹1,00,000 (₹1 lakh); Category II AIF — ₹1,00,000 (₹1 lakh); Category III AIF — ₹5,00,000 (₹5 lakh). The fee is paid online at the time of submitting the Form A application on the SEBI Intermediary Portal. In addition to the SEBI fee, there are costs associated with trust deed stamping, legal documentation, trustee fees, and compliance setup that should be budgeted for in the overall AIF launch cost.

How long does it take for SEBI to register an AIF?

SEBI is required to grant a Certificate of Registration or reject an application within 21 working days of receipt of a complete application. In practice, SEBI typically issues queries within 21 working days (rather than final approval), and the clock restarts after the applicant responds to each round of queries. A well-prepared application typically completes the process in 2 to 4 months. Poorly prepared applications or complex structures may take 6 to 12 months due to multiple query rounds. Our application management service is designed to minimise query rounds by ensuring the application is complete and consistent at first submission.

Can a fund manager register multiple schemes under a single AIF?

Yes. Under the AIF Regulations, an AIF can launch multiple schemes — each scheme has its own corpus, investors, and investment mandate. Each new scheme requires a fresh SEBI filing (not a new AIF registration) and a new placement memorandum. Scheme-level filings are typically faster than the initial AIF registration. Some fund managers use multi-scheme structures to target different investor groups, different vintages of investment, or different sub-strategies within the same AIF category. However, the total number of investors across all schemes must not exceed 1,000 (100 for Angel Funds).

What is the Private Placement Memorandum (PPM) and why is it important?

The Private Placement Memorandum (PPM) is the primary disclosure document through which an AIF invites investors to commit capital to the fund. It must contain the disclosures prescribed in the Third Schedule to the SEBI AIF Regulations — including the investment objective, strategy, risk factors, fees and expenses, conflicts of interest, and redemption/exit rights. SEBI reviews the PPM as part of the registration process. Investors sign the PPM as part of their subscription agreement. An accurate, comprehensive, and SEBI-compliant PPM is critical — omissions or misstatements can expose the fund manager to regulatory action and investor disputes post-close.

Is a SEBI-registered custodian mandatory for all AIFs?

A SEBI-registered custodian is mandatory for Category III AIFs. For Category I and Category II AIFs, a custodian is mandatory only if the AIF's corpus exceeds ₹500 crore — below this threshold, the trustee may hold securities directly. In practice, many Category I and II AIFs voluntarily appoint a custodian even below the mandatory threshold to enhance investor confidence and governance. The custodian holds the fund's assets in safe custody, records ownership, and processes settlement instructions — providing an independent check on the fund's asset base.

Start Your AIF Registration Journey Today

Complete SEBI AIF application support — Form A filing, PPM drafting, query management, and registration to launch for all AIF categories.

Talk to an Expert