SEBI has changed how unitholder approval is counted in InvITs. The 75% test now applies to votes cast on a resolution, not to units held by value, and votes of parties related to the transaction are excluded where the rule says so. The amendment also permits depository receipts on InvIT units and requires an exit option for dissenting unitholders when a sponsor leaves. It came into force on 14 October 2026.
- Approval needs at least 75% of the votes cast on the resolution, not 75% of unitholders by value
- Related parties' votes are left out of the count in regulation 22(5C) and 22(7)(a)
- New regulation 14(5C): depository receipts may be issued on InvIT units, in the manner the Board specifies
- New regulation 22(7)(b)(iv): dissenting unitholders get an exit option when a sponsor leaves an InvIT with multiple sponsors
- In force from 14 October 2026, the date of Gazette publication
What changes
- Voting test (regulation 22): approval is now measured as at least 75% of the total votes cast for the resolution. Earlier it was approval from 75% of unitholders by value.
- Related parties: in regulation 22(5C) and 22(7)(a), the votes cast by parties related to the transaction are excluded from the count.
- Depository receipts (regulation 14): new sub-regulation (5C) allows depository receipts to be issued on InvIT units, subject to the regulations and in the manner the Board specifies.
- Sponsor exit (regulation 22(7)(b)(iv)): where an InvIT has several sponsors and one exits, the outgoing sponsor or its sponsor group entities, or a continuing sponsor or its sponsor group entities, must give dissenting unitholders an option to exit by buying their units, in the manner the Board specifies.
Who it applies to
InvITs, their sponsors and sponsor group entities, and unitholders who vote on InvIT resolutions. Companies that sponsor or invest in InvITs should review their approval and voting procedures.
From when
The regulations were notified on 12 October 2026 and published in the Gazette on 14 October 2026. They came into force on the date of publication, 14 October 2026.
Background: the earlier position
Regulation 22 asked for approval from 75% of the unitholders by value. For related-party matters, the value of units held by parties related to the transaction was left out of that calculation.
Effect in practice
- The 75% is now worked out on votes actually cast on the resolution. Units that are not voted no longer count in the calculation, so turnout and voting patterns matter more.
- Related parties may still vote, but their votes are not counted in the transactions covered by regulation 22(5C) and 22(7)(a).
- A sponsor leaving a multi-sponsor InvIT must make sure dissenting unitholders are offered a buy-out of their units. The manner will be as the Board specifies.
- Depository receipts on InvIT units are now permitted in principle. Look for the Board's specified manner before using them.
What changed
See the table below for each provision.
| Provision | Before | Now | What it means |
|---|---|---|---|
| Regulation 14(5C) (new) | No provision on depository receipts. | “Depository Receipts may be issued on units of an InvIT subject to compliance with these regulations and in such manner as may be specified by the Board.” | Depository receipts can be issued on InvIT units, in the manner the Board specifies. |
| Regulation 22(5A) | “from seventy five per cent. of the unit holders by value shall be obtained.” | “shall be obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution.” | Approval is tested on votes cast, not on unitholding by value. |
| Regulation 22(5C) | “from seventy five per cent. of the unit holders by value excluding the value of units held by parties related to the transaction, is obtained:” | “is obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution, excluding the votes cast by the parties related to the transaction:” | 75% of votes cast is needed, and related parties' votes are not counted. |
| Regulation 22(7)(a) | “from seventy five per cent. of the unit holders by value excluding the value of units held by parties related to the transaction shall be obtained” | “is obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution, excluding the votes cast by the parties related to the transaction;” | Same votes-cast test applies here, with related parties' votes excluded. |
| Regulation 22(7)(b)(iv) (new) | No specific exit option for dissenting unitholders on a sponsor's exit. | “(iv) in case of an exit of a sponsor in an InvIT with multiple sponsors, the outgoing sponsor or its sponsor group entities or any of the continuing sponsor or its sponsor group entities shall provide the dissenting unitholders an option to exit by buying their units in the manner specified by the Board.” | Dissenting unitholders must be offered a buy-out when a sponsor exits a multi-sponsor InvIT. |
In the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014, ─ I. in regulation 14, after sub-regulation (5B), the following sub-regulation (5C) shall be inserted, namely, - “(5C) Depository Receipts may be issued on units of an InvIT subject to compliance with these regulations and in such manner as may be specified by the Board.” II. in regulation 22, (a) in sub-regulation (5A), the words and symbols “from seventy five per cent. of the unit holders by value shall be obtained.” shall be substituted with the words and symbols “shall be obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution.” (b) in sub-regulation (5C), the words and symbols “from seventy five per cent. of the unit holders by value excluding the value of units held by parties related to the transaction, is obtained:” shall be substituted with the words and symbols “is obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution, excluding the votes cast by the parties related to the transaction:”. (c) in sub-regulation (7), i. in clause (a), the words and symbol “from seventy five per cent. of the unit holders by value excluding the value of units held by parties related to the transaction shall be obtained” shall be substituted with the words and symbols “is obtained from the unitholders, where the votes cast in favour of the resolution shall be at least seventy five per cent. of the total votes cast for the resolution, excluding the votes cast by the parties related to the transaction;”. ii. in clause (b), after sub-clause (iii), the following sub-clause (iv) shall be inserted, namely, - “(iv) in case of an exit of a sponsor in an InvIT with multiple sponsors, the outgoing sponsor or its sponsor group entities or any of the continuing sponsor or its sponsor group entities shall provide the dissenting unitholders an option to exit by buying their units in the manner specified by the Board.”.
- InvIT
- Infrastructure Investment Trust: a trust that pools money from investors to own infrastructure assets and issues units.
- Unitholder
- An investor who holds units of an InvIT.
- Sponsor group entities
- Companies and other entities belonging to the same group as a sponsor of the InvIT.
- Dissenting unitholders
- Unitholders who voted against a resolution or disagree with the proposal.
- Depository receipts
- Instruments issued against underlying units, which are held by a depository.
- Official Gazette
- The Government's official publication; rules usually take effect from their publication in it.
This update summarises an official document for general information. It is not legal advice; please consult us before acting on it.