Description

ICICI Prudential Global Advantage Fund (FOF) will be grandfathered with effect from January 27, 2026, and must be merged or wound up within 3 years from January 20, 2026, following SEBI's framework on FOF schemes.

Summary

ICICI Prudential Asset Management Company Limited has announced the grandfathering of ICICI Prudential Global Advantage Fund (FOF) effective January 27, 2026, pursuant to SEBI’s framework on Fund of Fund schemes dated February 6, 2025. The scheme could not be classified under any category specified in the new framework and will be required to merge or wind up within 3 years from January 20, 2026. All fresh subscriptions and SIP/STP registrations will be discontinued from February 5, 2026, while redemptions and switch-outs will continue.

Key Points

  • Scheme grandfathered effective January 27, 2026 as it does not fit any category under SEBI’s new FOF framework
  • Mandatory merger or winding up required by January 20, 2029 (3 years from SEBI permission date)
  • All existing SIP and STP-IN registrations will be discontinued from February 5, 2026
  • IDCW reinvestment option will be changed to IDCW Payout from February 5, 2026
  • Fresh subscriptions through lump sum, switch-in, new SIP/STP already discontinued since August 13, 2024
  • Redemptions, switch-outs, existing STP-Out and SWP will continue unaffected
  • Scheme will continue to follow applicable regulatory guidelines and SID/KIM provisions

Regulatory Changes

SEBI issued a framework on February 6, 2025 regarding ‘Framework for launching of Fund of Fund (FOF) schemes with multiple underlying Funds’ which required FOF schemes to be classified under specific categories. ICICI Prudential Global Advantage Fund (FOF) could not be classified under any of these categories with its existing asset allocation and investment objective. SEBI granted grandfathering permission on January 20, 2026, allowing the scheme to continue temporarily but requiring it to merge or wind up within 3 years.

Compliance Requirements

For the Asset Management Company:

  • Discontinue all existing SIP and STP-IN registrations by February 5, 2026
  • Convert all IDCW reinvestment options to IDCW Payout by February 5, 2026
  • Continue adhering to applicable regulatory guidelines and SID/KIM provisions
  • Complete merger or winding up of the scheme by January 20, 2029

For Investors:

  • No fresh subscriptions allowed through any mode (lump sum, switch-in, SIP, STP)
  • Existing SIP/STP investments will cease from February 5, 2026
  • Investors can continue to redeem or switch out from the scheme
  • Periodically review and update KYC details including mobile number and email

Important Dates

  • February 6, 2025: SEBI issued FOF framework letter to AMFI
  • August 13, 2024: Fresh subscriptions discontinued
  • January 20, 2026: SEBI granted grandfathering permission
  • January 22, 2026: Notice issued to investors
  • January 27, 2026: Grandfathering effective date
  • February 5, 2026: Existing SIP/STP-IN discontinued; IDCW reinvestment changed to payout
  • January 20, 2029: Deadline for scheme merger or winding up (3 years from permission date)

Impact Assessment

Investor Impact (High):

  • All investors with existing SIP/STP investments will see their systematic investment plans terminated from February 5, 2026
  • Investors seeking regular automated investments will need to make alternative arrangements
  • IDCW reinvestment investors will receive payouts instead of automatic reinvestment
  • The scheme has a maximum 3-year lifespan, requiring investors to plan exit or migration strategies

Market Impact (Medium):

  • Affects all unitholders of ICICI Prudential Global Advantage Fund (FOF)
  • May lead to redemption pressure as investors adjust their portfolios
  • Part of broader regulatory restructuring of FOF category in Indian mutual fund industry

Operational Impact:

  • No new inflows allowed, limiting scheme growth
  • Redemption and switch-out facilities remain operational, ensuring liquidity for investors
  • AMC must plan merger or winding-up process within the 3-year timeline

Impact Justification

Significant change affecting all existing investors in ICICI Prudential Global Advantage Fund (FOF) with mandatory scheme closure within 3 years and immediate discontinuation of SIP/STP investments.