Regulatory Decision
IFSCA Consultation Paper: Expanding Jurisdictions for Fund Distribution via GIFT City
The International Financial Services Centres Authority has issued a consultation paper proposing to add the European Union (excluding Croatia), the UAE, Singapore and Australia to the list of foreign jurisdictions from which IFSCA-registered distributors in GIFT City can sell capital market products to investors, expanding on the existing Master Circular for Distributors dated 5 August 2025.
| Deciding body | International Financial Services Centres Authority (IFSCA) |
|---|---|
| Instrument | Consultation paper (draft/proposal stage, not yet finalised) |
| Legal basis | IFSCA (Capital Market Intermediaries) Regulations, 2025, Regulation 32; Master Circular for Distributors in the IFSC dated 5 August 2025 |
| Jurisdictions proposed to be added | European Union (excluding Croatia), UAE, Singapore, Australia |
| Jurisdictions sought by industry but not included in this proposal | Luxembourg, Ireland, Cayman Islands, Cyprus |
| Who is affected | Registered Distributors operating in GIFT IFSC and their clients (any category, including retail) |
| Related prior action | AML/KYC Guidelines 2022 amended 31 October 2025 to allow V-CIP onboarding of NRIs from UAE, Singapore, Australia and EU (excl. Croatia) |
| Process stage as of | 22 July 2026 — public/stakeholder comment period open; final rule not yet notified |
What was decided
IFSCA has not yet made a final decision — it has published a consultation paper inviting comments on a proposal to widen the list of overseas jurisdictions covered by its distribution rules for GIFT IFSC. The International Financial Services Centres Authority (IFSCA) has issued a consultation paper inviting public and stakeholder comments on a proposal to expand the list of jurisdictions from which Registered Distributors in IFSC may distribute capital market products and services to any category of clients under the IFSCA (Capital Market Intermediaries) Regulations, 2025.
IFSCA proposes expanding the permitted list, in line with its V-CIP framework, by adding the UAE, Singapore, Australia and the European Union excluding Croatia to the Master Circular for Distributors in the IFSC dated 5 August 2025. The proposal would allow regulated distributors operating in GIFT IFSC to offer eligible investment products from additional international markets, including the European Union, the UAE, Singapore and Australia, subject to regulatory conditions.
Why the change is being proposed
The proposal follows representations seeking inclusion of additional jurisdictions such as Luxembourg, Ireland, Cayman Islands and Cyprus, and notes IOSCO fund statistics indicating that several major fund jurisdictions are not currently covered. Industry representations specifically flagged an anomaly in the existing list: Luxembourg and Ireland, being home to one of the largest funds industries in Europe and the world, are presently not included in the list of identified foreign jurisdictions, even though UCITS funds set up in the United Kingdom, France and Germany are currently permitted while similar UCITS funds set up in Luxembourg and Ireland are not.
Notably, this consultation paper's proposed additions (EU excluding Croatia, UAE, Singapore, Australia) do not include Luxembourg, Ireland, Cayman Islands or Cyprus as separate line items — the EU addition would, however, capture Luxembourg and Ireland as EU member states. The regulator states that the list of jurisdictions may be expanded to encourage cross-border investments by retail investors through Registered Distributors in the IFSC in a regulated and transparent manner, in compliance with the applicable laws of the respective jurisdictions.
How this links to the existing regulatory framework
IFSCA issued a Master Circular on 5 August 2025 consolidating distributor requirements under the IFSCA (Capital Market Intermediaries) Regulations, 2025, under which distributors may offer capital market products and services across India, the IFSC, and specified foreign jurisdictions. The CMI Regulations themselves were notified in April 2025, replacing the IFSCA (Capital Market Intermediaries) Regulations, 2021.
The proposed expansion is explicitly tied to IFSCA's Video-based Customer Identification Process (V-CIP) list. The IFSCA (Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines 2022 were amended on 31 October 2025 to allow onboarding of Non-Resident Indians through V-CIP if they reside in the UAE, Singapore, Australia or the European Union excluding Croatia, in addition to seven other jurisdictions already covered. This distribution-list proposal would bring the two frameworks into alignment.
Practical effect if finalised
Under the proposed changes, distributors regulated by IFSCA would be permitted to offer investment products from additional jurisdictions, including the European Union, the United Arab Emirates, Singapore and Australia, subject to compliance with prescribed regulatory requirements. At present, fund distribution activities within GIFT IFSC are limited to investment products originating from a specified list of jurisdictions.
The move is aimed at broadening investment choices for eligible investors, strengthening GIFT City's position as an international financial services hub and aligning its distribution framework with global practices. The expanded framework is intended to diversify the investment options available through the IFSC ecosystem.
Current status and next steps
IFSCA has invited public comments on the draft proposal before finalising the revised regulatory framework. As of 22 July 2026, this remains a consultation-stage proposal — no amended regulation, circular or gazette notification giving it legal effect has been reported. Investors and distributors should treat the current Master Circular for Distributors in the IFSC (dated 5 August 2025) as the operative rule until IFSCA issues a final amendment.
This is one of several active IFSCA consultations on GIFT IFSC distribution and capital-market rules running in parallel, including separate papers on differential distribution for blended finance and on direct listing without a public offer, so market participants should track the specific paper number when submitting comments.
Frequently asked questions
Has IFSCA finalised this change, or is it still a proposal?
It is still a proposal. IFSCA has invited public comments on the draft proposal before finalising the revised regulatory framework, so the expanded jurisdiction list is not yet in force.
Which new jurisdictions would be added under this proposal?
The proposal would add the UAE, Singapore, Australia and the European Union excluding Croatia to the Master Circular for Distributors in the IFSC dated 5 August 2025.
Does this mean Luxembourg and Ireland-domiciled funds will now be distributable in GIFT City?
Industry had specifically asked for Luxembourg, Ireland, Cayman Islands and Cyprus to be added, noting that UCITS funds in Luxembourg and Ireland are not currently permitted even though similar UK, French and German UCITS funds are. This consultation paper's proposed list is EU (excl. Croatia), UAE, Singapore and Australia — the EU addition would cover Luxembourg and Ireland as member states, but Cayman Islands and Cyprus are not part of this specific proposal.
Who does this affect?
It affects Registered Distributors in GIFT IFSC regulated under the IFSCA (Capital Market Intermediaries) Regulations, 2025, and any category of client — including retail investors — who buy capital market products through them.
Why is IFSCA doing this now?
The proposal follows representations from market participants and notes IOSCO fund statistics indicating that several major fund jurisdictions are not currently covered under the existing distribution list, and it aligns the distribution rules with jurisdictions already approved for V-CIP-based NRI onboarding since October 2025.
What rule currently governs distribution in GIFT IFSC?
The Master Circular for Distributors in the IFSC, issued by IFSCA on 5 August 2025, consolidates distributor requirements under the Capital Market Intermediaries Regulations, 2025, and lists which foreign jurisdictions' products may currently be distributed.