What changed
10-working-day launch for regular schemes
An AIF can launch a new regular scheme 10 working days after filing the application with SEBI, unless SEBI advises otherwise. A fund’s first scheme can launch from the date of SEBI registration or 10 working days after filing, whichever is later.
"Launch" means circulating the PPM
The circular defines launch as circulation of the PPM to investors for soliciting funds. Working days exclude Saturdays, Sundays and public holidays on which the concerned SEBI office is closed.
Filing pack through a merchant banker
Regular schemes file the PPM on the SEBI intermediary portal through a SEBI-registered merchant banker, with the scheme fee and four documents: the merchant banker’s due diligence certificate (Annexure 6), fit-and-proper declarations for the AIF, sponsor and manager, sponsor and manager declarations on minimum continuing interest, and PAN copies of the AIF, scheme, sponsor, manager, trustee, their directors or partners and key investment team members, plus a list of those names and PANs in Excel, Word or PDF.
Independent merchant banker
The merchant banker must independently check the PPM disclosures for veracity and adequacy, and cannot be an associate of the AIF, its sponsor, manager or trustee. Its details go into the PPM.
Mandatory disclaimer
Every regular scheme PPM must carry a four-part disclaimer. It names the merchant banker and the date of its due diligence certificate, and states that filing with SEBI is not SEBI approval.
Responsibility sits with the manager and merchant banker
Both are responsible for the accuracy and completeness of the PPM and of their declarations, and are liable for action for any irregularity or lapse.
AI-only funds, LVFs and angel funds
Schemes only for accredited investors (AI-only funds) and Large Value Funds, where each investor puts in at least ₹25 crore, can launch as soon as the PPM is filed, without a merchant banker. Their first scheme launches from registration. Angel funds can circulate the PPM from registration. All three file an undertaking signed by the manager’s CEO and compliance officer (Annexure 7) and carry their own disclaimer. New AI-only schemes must end their name with "AI only fund" or "AIOF", and LVFs with "LVF".
PPM changes for AI-only, LVF and angel funds
These funds file changes to PPM terms directly with SEBI, with a CEO and compliance officer undertaking (Annexure 17), instead of going through a merchant banker.
What it means for operations
The circular is short, but it moves real work inside the fund. SEBI can still advise otherwise within the 10 days, but the disclaimer now says in plain words that filing is not approval. The real check has to happen before filing, and someone has to be able to show it happened.
Your internal PPM review becomes the control
Who drafted each section, who reviewed it, which comments were closed, and who signed off. For AI-only funds and LVFs, the CEO and compliance officer sign the undertaking personally, so they will want that trail before they sign.
The certified version must be the circulated version
The disclaimer carries the date of the due diligence certificate or undertaking. If the PPM changes after that date and before circulation, you have a mismatch. Lock the certified version and track any change after it.
The 10-day clock needs an owner
Record the filing date, work out the earliest launch date in SEBI working days, and confirm there is no "otherwise advised" from SEBI before anyone circulates the PPM. Investor relations sending a draft early is now, by definition, a launch.
The filing pack is a checklist, so treat it like one
PANs for every entity and key investment team member, fit-and-proper declarations, continuing interest declarations. Pull them from one maintained register rather than chasing them per scheme.
Naming and change filings
AI-only and LVF scheme names need the suffix. Any later change to PPM terms needs its own filing with a signed undertaking, so changes to terms should go through a controlled approval, not an email thread.
Checklist for this week
- ✓Map who drafts, reviews and signs off each PPM section, and keep the evidence with the document.
- ✓Freeze the version that goes to the merchant banker (or into the CEO and compliance officer undertaking) and log every change after that.
- ✓Add a launch-date tracker: filing date, earliest launch date in SEBI working days, SEBI response status, first circulation date.
- ✓Tell investor relations and distribution that circulating the PPM to investors is the launch, and nothing goes out before the cleared date.
- ✓Build one register of PANs, fit-and-proper and continuing interest declarations, and update it when people or entities change.
- ✓For AI-only and LVF schemes, check the scheme name ends with "AI only fund"/"AIOF" or "LVF".
- ✓Route any change to PPM terms through a formal approval before it is filed with SEBI.
This is a plain-English summary for operations teams, not legal or regulatory advice, and it is not endorsed by SEBI. Read the circular itself and take advice on how it applies to your fund or company.
Works with alternative lenders, AIFs, NBFCs and insurers in India on approvals, maker-checker controls and audit readiness.
Averoic can run reviews, sign-offs and filing trackers like these as configured workflows, with a record of who did what and when.
Frequently asked questions
What is the SEBI GARUDA mechanism?
GARUDA (Green-Channel: AIF Rollout Upon Document Acknowledgement) is the process SEBI set out in its circular of 30 July 2026 for filing AIF placement memoranda. Regular schemes can launch 10 working days after filing through a merchant banker unless SEBI advises otherwise, and AI-only funds, LVFs and angel funds can launch without a merchant banker.
Does filing the PPM under GARUDA mean SEBI has approved it?
No. The mandatory disclaimer states that submission of the PPM to SEBI should not be treated as approval, and that SEBI takes no responsibility for the accuracy of the disclosures. The manager and, for regular schemes, the merchant banker are responsible.
When can a regular AIF scheme launch under GARUDA?
Ten working days after filing the application with SEBI, unless SEBI advises otherwise. For a fund’s first scheme, the later of the registration date and ten working days after filing. Launch means circulating the PPM to investors to solicit funds.
Which AIFs do not need a merchant banker to file the PPM?
AI-only funds (schemes only for accredited investors), Large Value Funds for Accredited Investors (each investor at least ₹25 crore) and angel funds. They file directly with an undertaking signed by the manager’s CEO and compliance officer.
From when does the GARUDA circular apply?
It came into force immediately on 30 July 2026 and applies to PPMs filed with SEBI from the date the SEBI (AIF) (Second Amendment) Regulations, 2026 were notified, 14 July 2026.