SEBI Circular – Timelines for rebalancing of portfolios of mutual fund schemes in cases of all passive breaches

SEBI vide its circular dated 26^th June, 2025, has clarified that the timelines for portfolio rebalancing in case of passive breaches, as prescribed under paragraph 2.9 of the Master Circular for Mutual Funds, shall now apply to all types of passive breaches, including those related to issuer, group, and sectoral limits in actively managed mutual fund schemes. This move aims to ensure consistent regulatory treatment of passive breaches—arising from factors like corporate actions, price movements, or large redemptions—and is based on the recommendation of the Mutual Funds Advisory Committee (MFAC).

Link: https://www.sebi.gov.in/web/?file=https://www.sebi.gov.in/sebi_data/attachdocs/jun-2025/1750938257248.pdf#page=1&zoom=page-width,-15,842