The Securities and Exchange Board of India (SEBI), on May 15, 2026, issued a circular prescribing conditions for Special Purpose Vehicles (SPVs) held by Infrastructure Investment Trusts (InvITs) after the conclusion or termination of concession agreements. The circular follows the amendment made to Regulation 2(1)(zy)(ii) of the SEBI (Infrastructure Investment Trusts) Regulations, 2014 on April 17, 2026, allowing such SPVs to continue retaining their SPV status subject to specified conditions.
SEBI has mandated that the Investment Manager must either exit the investment in such SPVs through sale, liquidation, merger, or winding-up, or acquire a new infrastructure project within one year from the later of termination/completion of the concession agreement, conclusion of pending claims or litigations, or completion of the defect liability period. The circular also excludes the time taken for obtaining statutory or regulatory approvals from the one-year timeline. Further, InvITs are required to make extensive annual disclosures regarding affected SPVs, including project status, liabilities, contingent liabilities, debt repayment schedules, pending litigations, adequacy of assets, and exit strategies.
Additionally, SEBI directed recognized stock exchanges to disseminate the circular on their websites and clarified that the circular comes into force with immediate effect. The framework has been issued under Section 11(1) of the SEBI Act, 1992, read with Regulation 33 and Regulation 2(1)(zy)(ii) of the SEBI (Infrastructure Investment Trusts) Regulations, 2014, to ensure transparency and orderly management of InvIT-held SPVs after project completion or termination.
[Notification No. SEBI/HO/DDHS/DDHS-PoD-2/I/11698/2026]
