Mutual fund compliance and legal advice
Mutual fund compliance means meeting the SEBI (Mutual Funds) Regulations, 1996 and SEBI's circulars at every level: the sponsor, the trustees, the asset management company and the distributors who sell the schemes. We advise these entities on their obligations, and we also help investors and their families with transmission of units and complaints. We are a law firm, not a SEBI-registered adviser or distributor, and we do not recommend schemes.
Last updated 23 August 2026 · VIVS Legal, Sanpada, Navi Mumbai
- Main regulation
- SEBI (Mutual Funds) Regulations, 1996
- Who we advise
- AMCs, trustees, distributors, investors and heirs
- Complaints
- AMC, then SCORES, then online dispute resolution
- Our role
- Legal advice only; not an adviser or distributor
- How we work
- From Sanpada, Navi Mumbai, and online
On this page
- How a mutual fund is structured in India
- What are the powers and duties of a mutual fund trustee?
- Mutual fund compliance for AMCs and distributors
- What happens to mutual fund units when an investor dies?
- Mutual fund regulations in India: the main sources
- How we work with you
- Where do compliance gaps usually appear?
How a mutual fund is structured in India
| Entity | Role | Main legal duty |
|---|---|---|
| Sponsor | Sets up the fund and contributes to the AMC's net worth | Meets SEBI's eligibility conditions |
| Trustees | Hold the fund's assets for unit holders and supervise the AMC | Protect unit holders' interests; at least two-thirds must be independent |
| Asset management company | Runs the schemes | Manages schemes as per the offer documents and the regulations |
| Custodian and registrar | Hold securities; keep investor records | Safekeeping and accurate records |
| Distributors | Sell schemes to investors | AMFI registration, suitability and commission disclosure |
What are the powers and duties of a mutual fund trustee?
Trustees are the investors' watchdog. They must make sure the AMC manages each scheme according to its offer document and the regulations, that transactions with associates are on fair terms, that investors' complaints are dealt with, and that conflicts of interest are managed. They can call for information, and they must report to SEBI where the AMC is not complying. Trustees who sign off on board papers without reading them carry real personal risk if something goes wrong.
Mutual fund compliance for AMCs and distributors
For AMCs
- Offer documents (scheme information document, statement of additional information, key information memorandum) and their updates.
- Advertisement and communication rules, including social media posts by staff.
- Related party and associate transactions, and investment limits.
- Policies required by SEBI circulars, and audit and inspection responses.
For distributors
- AMFI registration and the code of conduct.
- Commission disclosure to investors, and the line between distribution and investment advice.
- Records of suitability and of what the investor was told.
What happens to mutual fund units when an investor dies?
When a unit holder dies, the units pass to the nominee or the legal heirs through transmission. The registrar asks for the death certificate, the claimant's KYC and, depending on the amount and whether there was a nominee, an indemnity, a no-objection from other heirs, or a succession certificate or probate. Remember that a nominee holds units for the legal heirs, as the Supreme Court made clear in 2023; our page on wealth management legal advisory explains this.
For mis-selling or service complaints, start with the AMC's grievance cell, then SEBI's SCORES platform, and then online conciliation and arbitration under SEBI's dispute resolution framework.
Mutual fund regulations in India: the main sources
- SEBI Act, 1992, and the SEBI (Mutual Funds) Regulations, 1996.
- SEBI's Master Circular for Mutual Funds and later circulars.
- The Indian Trusts Act, 1882, since a mutual fund is constituted as a trust.
- AMFI's guidelines and code of conduct for distributors.
How we work with you
- Scope. A compliance review, a specific transaction, an inspection response or a complaint.
- Documents. Offer documents, policies, board minutes, agreements or investor correspondence.
- Advice. A written view on the obligation and the risk.
- Drafting. Policies, replies to SEBI or AMFI, agreements or complaints.
- Follow-up. Hearings, settlement or arbitration where needed.
We work from Sanpada, Navi Mumbai, and online. Related pages: equities and SEBI matters and portfolio management services.
Where do compliance gaps usually appear?
- Distributors giving advice for a fee without registering as investment advisers.
- Marketing posts by staff that breach the advertisement rules.
- Trustee minutes that record approval without any discussion of the issue.
- Transmission requests stuck because the heirs' documents do not match the folio details.
Frequently Asked Questions
Still have a question?
Speak with our legal team about your matter with clarity and confidence.
It is the set of legal obligations that sponsors, trustees, AMCs and distributors must meet under the SEBI (Mutual Funds) Regulations, 1996 and SEBI's circulars, covering offer documents, investments, disclosures, advertisements, investor complaints and governance.
A distributor can explain products it sells, but giving investment advice for a fee requires registration as an investment adviser under SEBI's rules. The two roles are kept separate to avoid conflicts of interest.
Through transmission. The nominee or legal heirs apply to the registrar with the death certificate, KYC documents and the forms required. Larger amounts or disputes among heirs may need a succession certificate or probate.
First to the AMC's investor service centre or grievance officer. If the reply is unsatisfactory, file on SEBI's SCORES platform. Unresolved disputes can then go to online conciliation and arbitration under SEBI's framework.
No. We give legal advice only. Scheme selection belongs with you and a SEBI-registered investment adviser.
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