The recent consultation paper by SEBI proposing changes to the co-investment framework for Category I & II intends to allow creation of a Co-Investment Vehicle (CIV), which would allow AIFs to offer co-investment opportunities to accredited investors in unlisted securities via a separate scheme under the AIF structure.
Key Takeaways:
- A separate CIV scheme will need to be launched for each co-investment in an investee company, with prior intimation to SEBI, in accordance with the shelf PPM for CIV schemes filed with SEBI at the time of registration. Each CIV will require separate bank accounts, demat accounts, and a PAN.
- CIVs will have the flexibility to invest up to 100% of their corpus in a single portfolio. Co-investment opportunities can only be provided to investors of the AIF who are Accredited Investors.
- Exit timing to be co-terminus for the AIF and CIV.
While the proposed changes could lead to more agile and competitive AIFs, it’s crucial that the regulatory framework remains streamlined and doesn’t introduce unnecessary complexity into the co-investment process. In light of this, SEBI has invited industry feedback on the consultation paper.
Reach out at priya.k@treelife.in for a discussion.
We Are Problem Solvers. And Take Accountability.
Related Posts


ESOP Taxation in India – A Complete Guide (2025)
Employee Stock Option Plans (ESOPs) have become an essential tool for businesses, especially startups and growth-stage companies, to attract, retain,...
Learn More

ESOPs in India: Process, Tax Implications, Exercise Price, Benefits
In the contemporary competitive job market, companies are constantly seeking innovative ways to attract and retain top talent. Employee Stock...
Learn More

Tax Exemption for Startups in India (2025)
In India, tax exemptions for startups are crucial for encouraging innovation and promoting the growth of new businesses. These exemptions...
Learn More