Brokers urges SEBI to reduce MF distributors’ charges

New Delhi: Stockbrokers association Anmi on Friday said it has suggested markets regulator Sebi to reduce Amfi registration charges as mutual fund distributors under the stockbroking public limited company category.

Brokers obtain registration as mutual fund distributors so that along with the services of equity trading, they can also provide the services to invest in mutual funds to their clients so that the clients can get all the financial market investment opportunities under one roof.

Association of Mutual Fund Industry in India (Amfi), under the category of corporate, has two fee structures, one for Private Limited Company and the other for Public Limited Company.

For Public Limited Company, registration charge stands at Rs 4 lakh and Rs 2 lakh for renewal. For a Private Limited Company, the registration fee is Rs 20,000, and the renewal charge stands at Rs 10,000.

“For many of the brokers who are Public 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 more than what is charged for Private Limited Company.

“In order to obtain the benefit in the fees, many of the stock brokers, who are limited companies are obtaining registration in another entity to carry out the distribution business because of which another entity is unnecessarily being created and brokers are also required to carry-out of the compliance activities for that entity,” Anmi said in a statement.