New Delhi, July 26 -- The Corporate Laws (Amendment) Bill, 2026, could give Category III alternative investment funds (AIFs) a tax-efficient alternative by allowing them to convert from trusts into limited liability partnerships (LLPs), potentially lowering tax costs and easing long-standing structural hurdles.

The amendments, introduced in Parliament and now before a Joint Parliamentary Committee, would for the first time allow specified trusts regulated by the Securities and Exchange Board of India (Sebi) to convert into LLPs.

AIFs invest in alternative assets such as private equity, hedge funds and other non-traditional investments beyond traditional stocks and bonds, with wealthy individuals and institutions as their main investors....