Introduction: Becoming a Research Analyst involves meeting specific eligibility criteria outlined by the Securities and Exchange Board of India (SEBI) under the Research Analyst Regulations of 2014. These regulations govern the registration process, qualifications, and norms required for individuals and entities seeking to operate as Research Analysts in India. Understanding these criteria is crucial for those aspiring to pursue a career in research analysis within the financial services sector.
ELIGIBILITY CRITERIA AND NORMS FOR REGISTRATION AS A RESEARCH ANALYST UNDER SEBI (RESEARCH ANALYST) REGULATIONS, 2014
An Application for grant of certificate of registration shall be made in Form A as specified in the First Schedule to SEBI (Research Analyst) Regulations, 2014 and shall be accompanied by a non-refundable application fee to be paid in accordance with Second Schedule to these Regulations. [Regulation 3(2)]
The Board may require the Applicant to furnish further information or clarification if required for the purpose of the Application. [Regulation 5(1)]
The Applicant or this Authorised Representative, if so required shall appear before the Board for personal presentation. [Regulation 5(2)]
CONSIDERATION OF APPLICATION AND ELIGIBILITY CRITERIA [REGULATION 6] –
The Board shall take into account the all the matters in particularly the following for the purpose of grant of certificate of registration:
1. Whether the applicant is an individual or body corporate or limited liability partnership firm?
2. In case the applicant is an individual, is he appropriately qualified and certified as per Regulation 7?
3. In case the applicant is a Body Corporate, whether the individuals employed as research analyst are qualified and certified as per Regulation 7?
4. In case the applicant is a partnership firm or a limited liability partnership, whether the partners engaged in issuance of research report are qualified and certified as per Regulation 7?
5. In case the applicant is a research entity, whether the individuals employed as research analysts are qualified and certified as per Regulation 7?
6. Whether the applicant fulfils the capital adequacy norms as specified in Regulation 8?
7. Whether the applicant, individuals employed as research analyst and partners of the applicant, if any, are fit and proper persons based on the criteria as specified in Schedule II of the Securities and Exchange Board of India (Intermediaries) Regulations, 2008?
8. Whether the applicant has the necessary infrastructure to effectively discharge the activities of research analyst?
9. Whether the applicant or any person directly or indirectly connected with the applicant has in the past been refused certificate by the Board and if so, the grounds for such refusal?
10. Whether any disciplinary action has been taken by the Board or any other regulatory authority against the applicant or any person directly or indirectly connected to the applicant under the respective Act, rules or regulations made thereunder.
QUALIFICATION AND CERTIFICATION REQUIREMENT [REGULATION 7] –
1. An individual registered as research analyst under these regulations, individuals employed as research analyst and partners of a research analyst, if any, engaged in preparation and/or publication of research report or research analysis shall have the following minimum qualifications, at all times:
- A professional qualification or post-graduate degree or post graduate diploma in finance, accountancy, business management, commerce, economics, capital market, financial services or markets; or
- professional qualification or post-graduate degree or post graduate diploma which is accredited by All Indian Council for Technical Education, National Assessment and Accreditation Council or National Board of Accreditation or any other council/board/body set up under an Act of Parliament in India for the purpose; or
- a professional qualification by completing a Post Graduate Program in the Securities Market (Research Analysis) from NISM of a duration not less than one year; or
- a graduate in any discipline with an experience of at least five years in activities relating to financial products or markets or securities or fund or asset or portfolio management.
2. An individual registered as research analyst under these regulations, individuals employed as research analyst and partners of a research analyst, if any, shall have, at all times, a NISM certification for research analysts as specified by the Board or other certification recognized by the Board from time to time.
Provided further that fresh certification must be obtained before expiry of the validity of the existing certification to ensure continuity in compliance with certification requirements.
CAPITAL ADEQUACY [REGULATION 8] –
1. In case of Individual or Partnership Firm- Net Tangible Assets of value not less than one lakh rupees.
2. In case of Body Corporate or Limited Liability Partnership Firm- Networth of not less than twenty-five lakh rupees.
The Board on being satisfied that the applicant complies with the requirements specified in regulation 6, shall send intimation to the applicant and on receipt of the payment of registration fees as specified in Second Schedule, grant certificate of registration in Form B under First Schedule, subject to such terms and conditions as the Board may deem fit and appropriate. [REGULATION 9]
The certificate of registration granted under regulation 9 shall be valid till it is suspended or cancelled by the Board. [REGULATION 10]
The Board may reject the application after giving the applicant a reasonable opportunity of being heard. The decision of the Board to reject the application shall be communicated to the applicant within 30 days of such decision. Once the application is rejected, the applicant shall forthwith cease to act as a research analyst and nothing contained in this Regulation shall affect the liability of the applicant under the law. [REGULATION 12]
The Certificate granted under Regulation 9 shall be subject to following conditions [REGULATION 13]:
1. The Research Analyst shall abide by these Regulations.
2. The Research Analyst shall forthwith inform the Board in writing, if any information or particulars previously submitted to the Board are found to be false or misleading or if there is any material change in the information already submitted.
3. The Research Analyst shall use the term “Research Analyst” in all correspondences with its clients.
Non Refundable Application Fee as per Second Schedule –
1. Rs.5000/-in case of Individuals or Partnership Firms or Proxy Advisory Firms
2. Rs.50,000/- in case of Body Corporate including LLP
Registration Fee as per Second Schedule to be paid at the time of grant of certificate of registration by the Board:
1. Rs.10,000/-in case of Individuals or Partnership Firms or Proxy Advisory Firms
2. Rs.5,00,000/- in case of Body Corporate including LLP
The above fees are to be paid by the Applicant within 15 days from the date of receipt of intimation from the Board.
Further the same shall be paid every five years from the date of grant of certificate of registration within 3 months before the expiry period for which fee has been paid.
Conclusion: In conclusion, eligibility to become a Research Analyst under SEBI regulations entails adherence to stringent criteria regarding qualifications, certification, capital adequacy, and application procedures. Individuals and entities aspiring to obtain registration must comply with these requirements to ensure compliance with regulatory standards and obtain the necessary certification. By fulfilling these criteria, Research Analysts contribute to the integrity and transparency of the financial markets, thereby fostering investor confidence and facilitating informed decision-making.
Author Bio
i want to apply for Research Analyst in SEBI.