Legislative Updates

The Government replaces the Indian Bills of Lading Act, 1856, with the Bills of Lading Act, 2025, to strengthen the Consignee Rights

The President of India gave assent to the Bills of Lading Act, 2025, which has now been officially published in the Gazette of India. The Act aims to modernize and codify legal provisions related to bills of lading, a critical document in the shipping and logistics industry.

Replacing the Indian Bills of Lading Act, 1856, this new law provides that all rights of suit and liabilities under a bill of lading shall vest in the consignee or any endorsee to whom property in the goods has passed, whether by consignment or endorsement. This aligns statutory law with long-standing mercantile custom.

Its key provisions include:

Section 2 – Transfers rights and liabilities from the original shipper to the consignee or lawful endorsee: The consignee of goods and endorsee as per bill of lading shall acquire all the rights & liabilities of the suit. 

Section 3 – Preserves the right of stoppage in transit and the right to claim freight from the original shipper: There will be no change in the right of stoppage in transit, or the right to claim freight against the original shipper or owner, or the liability of the consignee or endorsee by reason or in consequence of his being such consignee or endorsee.  

Section 4 – Makes bills of lading conclusive evidence of shipment in the hands of a bona fide consignee or endorsee, even if the goods were not actually shipped, subject to exceptions for fraud or notice.  

Section 5 – Empowers the Central Government to issue directions for the implementation of the Act.

Section 6 – Repeals the 1856 Act but safeguards actions, rights, and proceedings under it through detailed saving provisions.

Link to the original Bill – https://prsindia.org/files/bills_acts/bills_parliament/2024/Bills_of_Lading_Bill_2024_Bill_Text.pdf

Regulatory Updates from SEBI

A. SEBI Extends Algo Trading Rule Implementation to 1st October 2025

The Securities and Exchange Board of India (SEBI) vide its Circular No. SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/108 July 29, 2025, has extended the implementation timeline for its earlier circular on “Safer participation of retail investors in Algorithmic trading.” 

The original circular, dated February 04, 2025, was set to take effect from August 01, 2025. However, following representations from stock brokers and other market participants, SEBI has decided to postpone the effective date to October 01, 2025. This extension aims to ensure a smooth implementation process without causing disruption to market players and investors. 

Stock Exchanges are directed to inform their members, disseminate the circular on their websites, establish systems for compliance, and amend relevant Bye-laws, Rules, and Regulations accordingly. This decision is made under SEBI’s powers to protect investor interests, promote market development, and regulate securities markets. 

Link to the original SEBI Regulation – https://www.sebi.gov.in/legal/circulars/jul-2025/extension-of-timeline-for-implementation-of-sebi-circular-sebi-ho-mirsd-mirsd-pod-p-cir-2025-0000013-dated-february-04-2025_95677.html

B. SEBI Modifies SIF Minimum Investment Monitoring 

The Securities and Exchange Board of India (SEBI) vide its Circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/107, dated July 29, 2025, has modified the mechanism for monitoring the minimum investment threshold in Specialized Investment Funds (SIFs). Building on previous circulars from February and April 2025, the new directive details steps for Asset Management Companies (AMCs) to handle active breaches, defined as an investor’s total investment falling below INR 10 lakh due to investor-initiated transactions. 

If an active breach occurs, all units of the affected investor across SIF investment strategies will be frozen for debit. A 30-day notice will be issued to the investor to rebalance their investments. Should the investor comply within this period, the units will be unfrozen. However, if the investor fails to rebalance, the frozen units will be automatically redeemed by the AMC at the Net Asset Value (NAV) of the next business day following the 30-day notice period. 

The AMCs, Registrar and Share Transfer Agents (RTAs), and Depositories are required to implement the necessary systems, with these provisions effective from July 29, 2025. 

Link to the original SEBI Regulation – https://www.sebi.gov.in/legal/circulars/jul-2025/monitoring-of-minimum-investment-threshold-under-specialized-investment-funds-sif-_95676.html

C. SEBI Eases NRI Derivative Trading Regulations

The Securities and Exchange Board of India (SEBI) vide its Circular No. SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/109, dated July 29, 2025, has simplified the monitoring of Non-Resident Indian (NRI) position limits in exchange-traded derivatives. 

Previously, NRIs were required to inform exchanges about their clearing members, and exchanges would assign a unique Custodial Participant (CP) Code for monitoring. However, this mandate has been removed to enhance operational efficiency and ease of investment for NRIs. 

Now, exchanges and clearing corporations will monitor NRI position limits for those without a CP code in the same way they monitor client-level position limits, which remain consistent with SEBI’s specified limits. 

Stock exchanges and clearing corporations must update their rules and operational procedures within 30 days and allow existing NRI clients to exit the CP code system via email request within 90 days. They also need to provide an option for NRIs who initially opt for a CP code to later exit it. 

This measure aims to streamline processes for NRIs participating in the derivatives market. 

Link to the original SEBI Regulation – https://www.sebi.gov.in/legal/circulars/jul-2025/operational-efficiency-in-monitoring-of-non-resident-indians-nris-position-limits-in-exchange-traded-derivatives-contracts-ease-of-doing-investment_95679.html

Regulatory Updates from RBI

RBI fastens the ceiling on the Regulated Entities’ contribution to Alternative Investment Funds 

The Reserve Bank of India (RBI) vide its Notification No. RBI/DOR/2025-26/138 dated July 29, 2025, has reviewed and revised its existing circulars, which prescribe the regulatory guidelines in respect of investment by the Regulated Entities (REs) such as Commercial Banks, Co-operative Banks, All-India Financial Institutions, and NBFCs, in Alternative Investment Funds (AIFs). Through this revision, the RBI has erected a ceiling on investments and provisioning by directing that from January 01, 2026 onwards: 

1. No RE shall individually contribute more than 10% of the corpus of an AIF Scheme, and collective contribution by all REs in any AIF Scheme shall not be more than 20% of the corpus of that scheme. However, this contribution limit will not apply to outstanding investments or commitments of a RE, if it was made with prior approval from the RBI under the provisions of its Master Direction (Financial Services provided by Banks) 2016. 
2. If a RE contributes more than five per cent of the corpus of an AIF Scheme, which also has downstream investment (excluding equity instruments) in a debtor company of the RE, then the RE shall be required to make 100% provision to the extent of its proportionate investment in the debtor company through the AIF Scheme, subject to a maximum of the direct loan and/ or investment exposure of the RE to the debtor company. 
3. If a RE’s contribution is in the form of subordinated units, then it shall deduct the entire investment from its capital funds proportionately from both Tier-1 and Tier-2 capital. 

Additionally, the Central Bank has emphasized that Circulars concerning investment in AIFs, namely DOR.STR.REC.58/21.04.048/2023-24 dated December 19, 2023, and DOR.STR.REC.85/21.04.048/2023-24 dated March 27, 2024, shall stand repealed from the effective date of the instant directions, and any new commitment by a RE for contribution to an AIF scheme, made after the effective date, shall be governed in terms of the revised Directions. 

However, the Regulator made it clear that outstanding investment by a RE, on the date of issuance of these Directions, in an AIF Scheme in which it has fully honoured its commitment, shall be governed by the provisions of the existing circulars. 

Link to the original RBI Regulation –

https://rbidocs.rbi.org.in/rdocs/notification/PDFs/138MD290720253B76DC1ABD824BD890EE6B4FF49C74F9.PDF