OBLIGATIONS OF COLLECTIVE INVESTMENT MANAGEMENT COMPANY :

Every Collective Investment Management Company should:

(i) be responsible for managing the funds or properties of the scheme on behalf of the unit holders and take all reasonable steps and exercise due diligence to ensure that the scheme is managed in accordance with the provisions of these regulations, the offer document and the trust deed;

(ii) exercise due diligence and care in managing assets and funds of the scheme and also responsible for the acts of commissions and omissions by its employees or the persons whose services have been availed by it;

(iii) remain liable to the unit holders for its acts of commission or omissions, notwithstanding anything contrary contained in any contract or agreement and be incompetent to enter into any transaction with or through its associates, or their relatives relating to the scheme. However, in case the CIMC enters into any transactions relating to the scheme with any of its associates, a report to that effect should immediately be sent to the trustee and to SEBI;

(iv) appoint registrar and share transfer agents and should also abide by their respective Code of Conducts as specified in the Third Schedule;

(v) give receipts for all monies received and report of the receipts and payments to SEBI, on monthly basis;

(vi) hold a meeting of Board of Directors to consider the affairs of scheme, at least twice in every three months and also ensures that its officers or employees do not make improper use of their position or information to gain, directly or indirectly, an advantage for themselves or for any other person or to cause detriment to the scheme;

(vii) obtain adequate insurance against the properties of the schemes and comply with such guidelines, directives, circulars and instructions as may be issued by SEBI from time to time on the subject of Collective Investment Scheme i.e. as the end of March, June, September and December.