SEBI eases InvIT rules, allows SPVs to retain status post concession expiry

India’s market regulator Securities and Exchange Board of India (SEBI) has amended the rules governing Infrastructure Investment Trusts (InvITs) to make it easier for these trusts to borrow more, raise capital, and improve on project retention.One of ther major changes to the rules involves allowing special purpose vehicles (SPVs) to retain their SPV status even after the completion or termination of concession agreements, subject to certain conditions.

Under the revised framework, investment managers can choose to either exit investment in an SPV by way of sale / liquidation / winding-up / merger of the SPV, or acquire a new infrastructure project through the SPV, or repurpose it, within specified timelines.
This has to be done within one year of any of the following conditions, whichever comes last:

• completion or termination of the concession agreement,
• conclusion of pending litigation or tax assessments, or
• completion of the defect liability period.

SEBI has also clarified that the time taken to obtain statutory or regulatory approvals for exiting investments through sale, merger or winding-up would be excluded from the one-year timeline.Also read: SEBI proposes new exchange-traded derivatives rules: What commodity traders should knowThe regulator has also mandated enhanced disclosures for such SPVs in the annual reports of InvITs. These disclosures will include details of the project, status of vesting certificates, assets and liabilities, contingent liabilities, outstanding debt and repayment schedules, adequacy of assets to meet liabilities, and timelines for exiting investments or acquiring new projects.

Investment managers will additionally be required to disclose pending claims, litigation, statutory obligations and details related to defect liability periods concerning such SPVs.

SEBI said the circular has come into effect immediately.

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In a separate circular, which is also effective immediately, SEBI has issued further clarifications to its circular of April 17, 2026, which expanded the permissible use of borrowings above 49% of an InvIT’s net assets.