Premises
Every unit operates from premises in the IFSC. In IFSCA's set-up workflow, the applicant identifies space with a co-developer, signs a letter of intent and receives a provisional letter of allotment before applying. The lease is signed after the SEZ Letter of Approval, and a copy is filed on SWIT within 6 months of that letter. The IFSC address forms part of the application, so the premises need to be settled early.
Some frameworks used to set minimum office-space ratios. The BATF Regulations, for example, required 60 sq ft of office space per employee. The Authority approved deleting that requirement on 22 December 2025, and the IFSCA (BATF) (Amendment) Regulations, 2026 are dated 8 January 2026. Material that repeats the old ratio is out of date. Check the current text of your own framework for any space or premises condition.
Where a group runs both an IFSC entity and an Indian entity, keep their premises, records and systems separate.
People
Most frameworks name the officers who must be in GIFT City:
| Framework | Presence requirement |
|---|---|
| Fund Management Entity | Principal officer and compliance officer based in the IFSC; portfolio proposals initiated by a person in the IFSC office |
| Global In-House Centre | Principal officer and compliance officer are full-time employees based in the IFSC |
| TechFin and ancillary services | Principal officer and compliance officer are full-time employees based in the IFSC |
| Treasury centre (GRCTC) | At least five qualified personnel based in the IFSC, including the head of treasury and the compliance officer, before operations start |
| BATF services | Principal officer and compliance officer based in the IFSC |
Several frameworks also set qualifications, experience and certification requirements for these officers. See KMP qualifications and certification.
An officer who is "based" in GIFT City only by address, but in fact works elsewhere, does not meet the requirement. Proposals for key persons located outside the IFSC are a frequent cause of queries.
Decision-making
Board meetings, credit and investment decisions and risk oversight should be traceable to the IFSC. For fund managers the FM Regulations make this explicit: the proposal on the portfolio composition of a fund must be initiated by a person based in the FME's IFSC office.
A useful distinction is between inputs and decisions. Group research, models and execution systems can support the IFSC team. The decision for the client or the portfolio should be made in GIFT City. We test it in four ways:
- Independence: the IFSC officer reviews the inputs and applies client-specific judgment, rather than adopting the group's allocation.
- Timing: the decision comes before the order, not after it.
- Documentation: records made at the time show the reasoning and the inputs considered.
- Presence: the decision-maker works from GIFT City as their primary workplace.
Substance and tax
The section 147 deduction under the Income-tax Act, 2025 applies to eligible income of an eligible IFSC unit. Tax authorities look at the same facts as IFSCA when testing whether income is really earned by the unit: who did the work, where, and with what authority. Thin presence invites challenge on eligibility and on transfer pricing between the unit and its group.
For units commencing on or after 1 April 2026, section 147(5) adds a further condition: the unit must not be formed by splitting up or reconstructing an existing business, subject to the exceptions in the section. Some frameworks impose similar rules of their own. The GIC Regulations, for example, prohibit setting up a GIC by transferring existing contracts or work arrangements from group entities in India.
Testing a model before filing
Where it is unclear whether a proposed operating model meets the substance expectation, a prospective entrant can apply under IFSCA's Informal Guidance Scheme, 2024 before the registration application. The request must be specific and factual, and is best framed as one well-defined question, with the applicant's own analysis.