SEBI Simplifies Transfer Process for Portfolio Management Services
Moneylife Digital Team 27 October 2025
Market regulator Securities and Exchange Board of India (SEBI) has introduced a new, streamlined framework for transferring portfolio management services (PMS) business from one portfolio manager to another, aimed at improving ease of doing business and ensuring smoother transitions within the PMS industry.
 
Under the new guidelines, a portfolio manager can transfer its PMS business only after securing prior approval from SEBI. The framework distinguishes between transfers within the same group and those involving unrelated entities, prescribing separate procedures for each.
 
When the transfer occurs between two portfolio managers belonging to the same group, both of whom hold valid PMS registrations, SEBI permits the transfer of either specific investment approaches or the entire PMS business, subject to certain conditions.
 
If the entire PMS business is transferred, the outgoing portfolio manager must surrender its PMS registration certificate within 45 working days of completing the transfer. However, if only selected investment approaches are transferred, the transferor may continue to hold its registration.
 
For transfers between portfolio managers not belonging to the same group, SEBI requires a joint application from both the transferor and the transferee. In such cases, the transfer must cover the entire PMS business, as partial transfers of selected investment approaches are not allowed.
 
The transferee must also comply with all regulatory requirements and take over responsibility for any pending actions, litigations and obligations of the transferor. A formal undertaking confirming this must accompany the joint application.
 
SEBI has directed that the transfer process be completed promptly within two months from the date of approval. Until the process is finalised, the outgoing portfolio manager may continue operating but cannot on-board new clients.
 
After all formalities are completed, or on expiry of the two-month period, whichever is earlier, the transferor must surrender its PMS registration certificate, SEBI says.
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