Anmi urges Sebi to reduce mutual fund distributor registration fees for public brokerage firms

The association of securities brokers Anmi said on Friday that it had suggested to the market regulator Sebi to reduce the fees for registering with Amfi as distributors of mutual funds in the category of public limited companies of brokerage. .

Brokers obtain registration as mutual fund distributors so that in addition to stock trading services, they can also provide mutual fund investing services to their clients so that clients can get all the investment opportunities in the financial markets under one roof.

The Association of Mutual Fund Industry in India (Amfi), in the corporate category, has two fee structures, one for the limited liability company and the other for the limited liability company.

For Public Limited Company, the registration fee is Rs 4 lakh and Rs 2 lakh for renewal. For a limited liability company, the registration fee is Rs 20,000 and the renewal fee is Rs 10,000.

“For many brokers who are limited companies, the fee structure of Rs. 4 Lakh for registration and Rs 2 lakh for renewal is very exorbitant as it is 20 times higher than what is charged for a limited company. limited liability.

“In order to gain the advantage of fees, many stockbrokers, which are limited liability companies, obtain registration in another entity to carry on the business of distribution due to which another entity is unnecessarily created and brokers are also required to perform compliance activities for this entity,” Anmi said in a statement.

The securities brokers association said it has repeatedly asked Amfi to create a category for securities brokers and to charge registration and renewal fees applicable to a limited liability company and the services distribution for a broker, whether a limited liability company or a limited liability company, are the same.

In response to its submission, Amfi responded that the Amfi fee classification and ARN fee structure is based on the legal status of entities and that all entities in a particular category are charged the fee uniformly regardless of or their size.

In response, the brokers association also communicated to them that apart from these legal entities, Amfi recognized other categories such as banks, NBFC, banks, companies, trusts, HUFs and that these entities also enjoy the benefit of reduced fees.

Anmi, on behalf of its 900 stockbrokers, had also informed Sebi about this and asked to intervene in the case and the association is still waiting for a favorable response for them in this case.

He pointed out that stock brokers are very important players in the capital market and play a very important role in the development and distribution of mutual funds.

Dolores W. Simon