IFSCA Capital Market Intermediaries Regulations, 2025: Registration and Net Worth Rules

Every securities market needs intermediaries, and every regulator has to decide which of them to license. The IFSCA (Capital Market Intermediaries) Regulations, 2025, notified on 11 April 2025 and published in the Gazette on 16 April 2025, replaced the earlier 2021 framework and now set out that perimeter for GIFT IFSC. They have already been amended twice, with the consolidated text current to 5 September 2026.

Two features distinguish them from their Indian counterpart regime: a single set of regulations covers eleven distinct intermediary types, and the regulations are made under a combination of powers, the IFSCA Act together with section 30 read with section 28C of the SEBI Act, 1992 and section 25 read with section 23G of the Depositories Act, 1996.

Who Must Register

Under Regulation 4(1) of the IFSCA (Capital Market Intermediaries) Regulations, 2025, a unit in GIFT IFSC must obtain a certificate of registration from IFSCA before undertaking any of the following 11 regulated activities:

• broker dealer;
• clearing member;
• credit rating agency;
• custodian;
• debenture trustee;
• depository participant;
• distributor;
• ESG Ratings and Data Products Provider (ERDPP);
• investment adviser;
• investment banker; and
• research entity.

An amendment added a proviso permitting a unit undertaking multiple activities to obtain a unified registration in the manner IFSCA specifies, which removes a significant administrative friction for multi-line businesses.

Banking Units are treated separately: a Banking Unit may act as banker to an issue subject to the regulatory provisions IFSCA specifies, and may act as an investment banker subject to authorisation in accordance with IFSCA’s requirements. The regulations also exempt certain entities from separate registration, for example as a research entity where an investment adviser, credit rating agency or fund management entity already holds registration, subject to the conditions specified.

What the Defined Terms Capture

Several definitions do more work than their labels suggest.

• “Custodial services” covers safekeeping plus maintaining accounts, collecting benefits and rights, keeping the client informed of issuer actions, reconciling records, and activities relating to issuance of depository receipts in an IFSC.
• “Investment advice” covers advice on investing in, purchasing, selling or dealing in securities or investment products, advice on portfolios, and financial planning, in any medium; but advice given through newspapers, magazines or broadcast or telecommunications media widely available to the public is excluded.
• “ESG Ratings” covers the broad spectrum of sustainable finance rating products, including ESG scorings, rankings, sector ratings and thematic scores; and the explanation to the ERDPP definition includes independent external review for ESG-labelled bonds listed on recognised stock exchanges in an IFSC as a permitted service. GIFT IFSC therefore licenses ESG ratings and data provision as a regulated activity in its own right.
• “Associate” includes a person exercising control, a person holding control of at least 20% of voting power, a holding or subsidiary company, a relative, a member of the same Hindu Undivided Family, and any other case where IFSCA takes the view, on the facts, that a person should be treated as an associate.
• “Control” includes the right to appoint a majority of directors or to control management or policy decisions, including through more than 50% of voting rights or interest, with a proviso that a director or officer is not in control merely by virtue of office.

Registration Mechanics

Applications are made in the form and manner IFSCA specifies. For a broker dealer, clearing member or depository participant, the application is routed with additional requirements, and the recognised stock exchange, clearing corporation or depository examines the applicant’s eligibility. An incomplete application is liable to be rejected. Additional norms may be specified for particular categories.

Applicants must satisfy legal form requirements, maintain the prescribed net worth, and ensure that the entity, its principal officer, and the other specified persons are fit and proper, applying criteria similar to those in the fund management regulations (Article 18). Each intermediary must appoint a principal officer and a compliance officer; the definition of compliance officer requires a senior officer reporting to the board or governing body who can understand financial statements and the applicable legal and regulatory requirements, including policies, records, risk management and the code of conduct.

Net Worth

Schedule I of the IFSCA (Capital Market Intermediaries) Regulations, 2025 prescribes the minimum net worth requirements for each category of capital market intermediary operating in GIFT IFSC.

The custodian figure is new. It replaced “as specified by the Authority from time to time” with effect from 13 January 2026, and custodians already registered were given until 30 June 2026 to infuse or earmark additional funds to meet the revised norm. Existing registrants in that category should be able to evidence compliance from that date.

Three general rules qualify the table. Net worth may be maintained at parent level for a branch, provided it is earmarked for the IFSC activity. The requirements are separate from and additional to net worth required for other activities. And where an entity registers for multiple categories, it must maintain the highest of the applicable requirements, unless IFSCA specifies otherwise.

Conduct and Supervision

Every CMI must abide by the code of conduct in Schedule II, which has a general part applicable to all intermediaries and further parts for specific categories. The regulations also provide for inspection by an “inspecting authority” appointed by IFSCA to examine books, accounts, records and documents.

Conduct obligations should be read with the IFSCA (Prohibition of Market Abuse in Securities Markets) Regulations, 2026 (Article 26), which impose the insider trading and market manipulation prohibitions that apply across the IFSC securities market.

Practical Points

• Map every activity before applying. Several business lines that a firm may regard as a single service, for example advisory plus distribution plus research, are separate registrable activities, though the unified registration route and the research-entity exemptions can reduce duplication.
• Confirm which body examines eligibility. For exchange- and depository-facing categories, the market infrastructure institution has a gatekeeping role in addition to IFSCA.
• Plan for the highest net worth, not the sum, where multiple registrations are sought.
• Treat the code of conduct as operative regulation. It is part of the regulations, not guidance, and breaches of conduct obligations have been the subject of IFSCA enforcement action (Article 4).

Update to 15 October 2026

Two developments after the research cut-off bear on intermediaries. First, by circular dated 18 September 2026 IFSCA amended Chapter III of its Master Circular for Distributors in the IFSC (5 August 2025). It added the United Arab Emirates, Singapore, Australia and the European Union to the specified jurisdictions under regulation 32(1)(a) and (c), taking the list from seven (the United States, Japan, South Korea, the United Kingdom excluding British Overseas Territories, France, Germany and Canada) to eleven. Products domiciled in the added jurisdictions may now be distributed more widely, including to retail clients, subject to the Regulations. Second, IFSCA notified the IFSCA (Electronic Trading Platforms) Regulations, 2026 by Notification No. IFSCA/GN/2026/016 dated 8 September 2026, published in the Gazette of India, Extraordinary, Part III, Section 4, on 10 September 2026 and in force from publication (IFSCA’s website listing carries the later upload date of 18 September 2026). They create a registration framework for electronic trading platforms operated in or accessed from GIFT IFSC, with exceptions that include a platform on which an IFSC Banking Unit or its parent bank is the sole quote-provider and counterparty. An intermediary operating or using such a platform should map that framework alongside these Regulations.

Frequently Asked Questions

1. What are the IFSCA (Capital Market Intermediaries) Regulations, 2025?

They establish the registration, net worth and conduct requirements for capital market intermediaries operating in GIFT IFSC.

2. Which intermediaries must register with IFSCA?

The regulations cover 11 categories, including broker dealers, custodians, investment advisers, investment bankers, distributors and research entities.

3. What is the minimum net worth for an IFSCA-registered intermediary?

It varies by category, from USD 25,000 for certain intermediaries to USD 1.5 million for debenture trustees. Broker dealers, clearing members and depository participants follow requirements specified by their respective market infrastructure institutions.

4. Can a firm obtain registration for multiple activities?

Yes. The regulations permit unified registration for multiple activities in the manner specified by IFSCA. Generally, the firm must maintain the highest applicable net worth requirement.

5. What compliance requirements apply to registered intermediaries?

Intermediaries must meet fit-and-proper criteria, appoint a principal officer and compliance officer, follow the applicable code of conduct and remain subject to IFSCA inspection.