Procedural Framework for Dealing with Unclaimed Amounts in REITs

1. UNCLAIMED AMOUNTS LYING WITH REAL ESTATE INVESTMENT TRUSTS (REITs) AND MANNER OF CLAIMING SUCH AMOUNTS BY UNITHOLDERS
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3. Introduction:

   • The circular addresses the procedural framework for handling unclaimed amounts in Real Estate Investment Trusts (REITs).
   • Issued under the authority of Section 11(1) of the Securities and Exchange Board of India Act 1992 and Regulation 33 of the REIT Regulations.
   • Effective from March 1, 2024.

4. Distribution Mandate (Regulation 18(16)(b)):

   • Regulation mandates that at least ninety percent of Net Distributable Cash Flows (NDCFs) of the REIT must be distributed to unitholders.

5. Distribution Declarations (Regulation 18(16)(c)):

   • Distributions must be declared and made at least once every six months, within fifteen days of declaration.
   • Unclaimed or unpaid distributions observed due to reasons such as unupdated account details.

6. Handling Unclaimed Amounts (Regulation 18(6)(f)):

   • Insertion of Regulation 18(6)(f) allows the transfer of unclaimed or unpaid distribution amounts to the 'Investor Protection and Education Fund' (IPEF).

7. Claiming Unclaimed Amounts (Regulation 18(6)(g)):

   • Regulation 18(6)(g) outlines the process for claiming unclaimed or unpaid amounts transferred to the IPEF.

8. Amendments to IPEF Regulations:

   • Amendments made to Regulations 4(1) and 5(3) of the SEBI (Investor Protection and Education Fund) Regulations, 2009 to define the handling of unclaimed amounts.

9. Procedure for Handling Unclaimed Amounts (Annex - A):

   • A framework defining the procedure for REITs to transfer unclaimed amounts to an Escrow Account and subsequently to the IPEF, along with the claim process by unitholders.

10. Effective Date:

    • The provisions of this Circular shall be effective from March 1, 2024.

11. Interest Computation:

    • REITs with unclaimed amounts for less than 7 years as of February 29, 2024, shall start computing interest from March 1, 2024.
    • REITs with unclaimed amounts for more than 7 years as of February 29, 2024, must transfer the amounts to IPEF by March 31, 2024.

12. Availability of Circular:

    • This Circular is available on the SEBI website, www.sebi.gov.in, under the category 'Legal,' within 'Circulars.'