Franklin MF fiasco: Sebi asks scheme units to be listed on stock exchanges

The securities market regulator, Sebi has said that the units of schemes in the process of winding up will have to be listed on recognised stock exchanges.
 
This rule will have to be followed by all open and close-ended schemes. This move by the market watchdog comes after Franklin Templeton Mutual Fund decided to wind up 6 of its debt mutual fund schemes. 
 
In a circular issued on Wednesday, Sebi said: 
 
"In terms of Regulation 31B(1) of the MF Regulations, the units of Mutual Fund schemes can be listed in the recognized stock exchange. Accordingly, the units of Mutual Fund schemes which are in the process of winding-up in terms of Regulation 39(2)(a) of MF Regulations, shall be listed on recognized stock exchange, subject to compliance with listing formalities as stipulated by the stock exchange." 
 
However, it is not mandatory for the investors to trade or sell their units.
 
"Pursuant to listing, trading on stock exchange mechanism will not be mandatory for investors, rather, if they so desire, may avail an optional channel to exit provided to them," the Sebi circular said. 
 

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