Ch.7 · Total Expense Ratio Limits · medium
What costs CANNOT be charged to a mutual fund scheme's TER?
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EXPLANATION
SEBI explicitly prohibits charging to the scheme: regulatory penalties or fines imposed on the AMC, litigation costs relating to AMC-level disputes, interest on delayed payments due to AMC negligence, and general AMC corporate overhead. These must be borne by the AMC from its management fee income. Only genuine scheme-level costs within prescribed limits can be charged to investors via TER.
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