The Securities and Exchange Board of India (SEBI), through its Circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/105 dated 23rd July 2025, has released an updated set of Frequently Asked Questions (FAQs) to provide greater clarity on the SEBI (Research Analysts) Regulations, 2014. These FAQs are framed following the SEBI (Research Analysts) (Third Amendment) Regulations, 2024 and subsequent operational guidelines issued on 8th January 2025.
This article provides a clause-by-clause, detailed and practitioner-friendly breakdown of all 36 FAQs, enabling Research Analysts (RAs) and research entities to ensure compliance.
1. Regulatory Framework:
The SEBI (Research Analysts) Regulations, 2014 cover a comprehensive framework for registration, certification, trading restrictions, compensation limits, disclosures, public appearances, code of conduct, record maintenance, inspections, and other procedural safeguards. These regulations became effective from 1st December 2014.
2. Registration for Employed Analysts:
Only entities engaged in research activities need registration. Individual employees (analysts) of these entities are not required to register with SEBI. However, they must meet educational and certification criteria and adhere to trading restrictions laid out in the regulations.
3. Definition of Research Analyst – Scope Exclusion:
Marketing, clerical, back-office, and support staff not directly involved in research nor having client interaction are not covered under the definition of a research analyst.
4. Communications Excluded from Research Report:
Exclusions include: general market commentary, index discussions, political/economic updates, fund-holder communications, internal memos, offer documents, technical summaries, sector-level analysis, and any communication SEBI may specify in future.
5. Technical Analysis Applicability:
While methodology is not restricted, any buy/sell/hold recommendation based on technical analysis for a specific security falls under RA Regulations. Technical charts solely discussing sectors or indices are exempt.
6. Clarification on Periodic Reports:
Reports like account statements, annual summaries, or mandatory disclosures issued to MF/AIF/PMS clients under specific SEBI regulations are not treated as research reports.
7. Scope of Covered Securities:
The RA Regulations apply to all instruments classified as ‘securities’ under Section 2(h) of the Securities Contracts (Regulation) Act, 1956—not limited to equities.
8. Registration Mandate:
Anyone intending to issue research reports or analysis must obtain SEBI registration unless specifically exempt. There is no grandfathering for prior unregistered analysts.
9. Definition of Research Entities:
Entities like SEBI-registered brokers and merchant bankers, if involved in research activity, must obtain RA registration. Exemptions apply only to those specifically covered in Regulation 3.
10. Exempted Intermediaries:
Investment Advisers, CRAs, AMCs, PMS, AIFs, VCFs need not register under RA Regulations. However, if they issue public reports or appear in media, they must comply with Chapter III (disclosures, trading restrictions, etc.).
11. Registration for Proxy Advisers:
Mandatory registration is required. Proxy advisers are fully subject to RA Regulations.
12. Proxy Adviser Requirements:
Must disclose the scope of research per recommendation, their internal data-validation mechanisms, interaction protocols with issuers, and maintain logs of their voting recommendations (which must be made available to SEBI on request).
13. Application Process:
Submit Form A with documents to RAASB (https://membershipraia.bseindia.com). After initial vetting, RAASB forwards to SEBI for registration.
14. Fee Structure:
| Category | Application Fee | Registration (5 years) | Renewal |
| Individual/Partnership | Rs. 2,000 | Rs. 3,000 | Rs. 1,000 |
| Proxy Advisers | Rs. 2,000 | Rs. 3,000 | Rs. 1,000 |
| Body Corporates | Rs. 20,000 | Rs. 30,000 | Rs. 5,000 |
| Additional fees may be levied by RAASB. |
15. Capital Requirements:
No capital adequacy norms exist. However, RAs must maintain deposit with RAASB based on their client count:
- Up to 150 clients: Rs. 1 lakh
- 151–300: Rs. 2 lakhs
- 301–1,000: Rs. 5 lakhs
- 1,001+: Rs. 10 lakhs
16. Sole Proprietors:
Permitted to register as independent RAs, subject to compliance with educational, experience, and certification norms.
17. Independent RAs:
Those not employed with any intermediary and engaged solely in research/analysis/reporting.
18. Definition of Public Media:
Any media platform (TV, radio, newspapers, internet, blogs, etc.) accessible to the public.
19. Disclosure Obligations in Media:
RAs and their employees must disclose registration status and financial interests when expressing views in public media. Even if the opinion is personal, it must comply with Regulations 16 and 17.
20. Journalists:
Not required to register. But if making recommendations, it must be based on reports from SEBI-registered RAs and include mandatory disclosures.
21. Foreign Analysts:
They may issue research on Indian securities if they enter into an agreement with a SEBI-registered RA.
22. Designation Norms:
RAs must clearly state “Research Analyst” in client communications. Part-time RAs must use “Part-time Research Analyst.”
23. Partnership Firms:
Only those partners who are engaged in research must fulfil the educational and NISM certification criteria.
24. Validity of Registration:
It is perpetual unless suspended/cancelled. However, renewal fees must be paid every 5 years.
25. Trading Activity Oversight:
Employers must track and record trading activity of all research staff.
26. Trading Restrictions:
RAs and associates:
- Cannot trade 30 days before and 5 days after report publication.
- Must not act contrary to recommendations.
- Cannot subscribe to IPOs of companies they cover.
Also applies to entities lacking segregation of research from other functions.
27. Appointment of Compliance Officer:
Non-individual RAs are required to appoint a Compliance Officer who shall be responsible for monitoring compliance requirements. This person can be internal member of RA or any independent professional like CS, CA, CMA. Also, the compliance officer is required to hold a relevant certification from NISM.
28. Shared Compliance Officers:
Permissible. An existing compliance officer of an intermediary may also serve as RA Compliance Officer.
29. Value-Added Research:
Research bundled with services (e.g., brokerage) is considered ‘research for consideration’ even if charged indirectly.
30. Distribution vs Research Distinction:
Merchant banking or brokerage is not distribution under Regulation 26C.
31. Conflict of Interest & Client-Level Segregation:
Distribution and research on the same product are not allowed. Client-level segregation is mandatory unless:
- Research is on stocks, distribution on mutual funds
- Distribution and research functions are structurally separate
32. NISM Certification Clarified:
Mandatory for anyone associated with research services, including sales/relationship managers having client contact. Not required for clerical or backend staff.
33. Institutional Clients & Compliance Exceptions:
- MITC: Disclosure only; no consent needed
- KYC: Required for fee-paying clients
- Recordkeeping: Mandatory for all. For email or digital records, call recordings not needed
34. Non-Fee Paying Clients:
Are considered clients. Counted for deposit and reporting. Consent needed unless the client is a QIB or institutional investor (then only disclosure suffices).
35. Client-Level Segregation Exemption for Institutional Clients:
All RAs can skip segregation for institutional clients if a standard waiver is obtained (email or digital waiver valid).
36. Rationale for Recommendations:
Every recommendation, including technical ones, must be backed by documented research, charts, and rationale.
Conclusion:
The updated FAQs bring critical clarity across all operational, structural, and compliance-related aspects of research services. RAs must proactively align their certification, internal controls, documentation protocols, trading compliance, and client communication practices as per this consolidated guidance. It serves as a single-point compliance reference for any RA operating in or intending to enter the Indian securities research space.
If you are a SEBI-registered RA and require help with compliance execution, audits, or client documentation, don’t hesitate to reach out for tailored support. Author can be reached at +91 90159 33164 \ info.compliancebuzz@gmail.com.
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