Which of the following statements about the RBI's operational framework for reclassification of FPI to FDI is/are correct?

1. Under the Foreign Exchange Management (FEM) Rules, 2019, an FPI investment must not exceed 10% of the total paid-up capital on a fully diluted basis.
2. FPIs breaching the 10% limit have the option to reclassify their holdings as FDI or divest their excess holdings.
3. The operational framework was introduced to manage investments made by domestic investors in foreign companies.