SEBI has issued Circular dated November 23, 2022, directing to Schemes of AIFs which have adopted Priority Distribution Model, not to accept any fresh commitment or make investment in a new investee company, till a view is taken by SEBI in this regard.
Priority Distribution Model is nothing but schemes of AIFs that have adopted a distribution waterfall in such a way that one class of investors (other than sponsor/manager) share loss more than pro rata to their holding in the AIF vis-à-vis other classes of investors/unit holders, since the later has priority in distribution over former.