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The Fund Sponsor is the first layer in the three-tier structure of Mutual Funds in India. SEBI regulations say that a fund sponsor is any person or any entity that can set up a Mutual Fund to earn money by fund management. This fund management is done through an associate company which manages the investment of the fund. A sponsor can be seen as the promoter of the associate company. A sponsor has to approach SEBI to seek permission for a setting up a Mutual Fund. However, a sponsor is not allowed to work alone. Once SEBI agrees to the inception, a Public Trust is formed under the Indian Trust Act, 1882 and is registered with SEBI. After the successful creation of the trust, trustees are registered with SEBI and appointed to manage the trust, protect the unit holder’s interest and to comply by the mutual fund regulations of SEBI. Subsequently, an asset management company is created by the sponsor that should be complying with the Companies Act, 1956 to regulate the management of funds. . Read more at: https://www.fincash.com/l/structure-mutual-funds