The year 2021 has been quite a ride for the Investment Advisors (IA) but it seems SEBI now has its eye on Research Analysts (RA) as well. To enhance transparency and bring about investors’ awareness, SEBI on 13th December 2021 has come up with a new set of disclosures that the IAs and RAs are required to comply with.

There are two new disclosures that the IAs and RAs shall make-

1. Investor Charter

It is a document that shall comprise of everything an investor should know while availing services from an IA or a RA. The Investor Charter shall contain the details of services provided to investors, their rights, dos and don’ts, responsibilities, investor grievance handling mechanism and timelines thereof, etc. in one single place to ensure investor awareness.

The detailed items of the Investor Charter are provided in Annexure A of the links below:

Circular No. SEBI/HO/IMD/IMD-II CIS/P/CIR/2021/0686- Dated: December 13, 2021

Circular No. SEBI/HO/IMD/IMD-II CIS/P/CIR/2021/0685- Dated: December 13, 2021

All the SEBI registered IAs and RAs shall display the Investor Charter on their websites and mobile application. Further, SEBI has clearly mentioned that in cases where there is no website or mobile applications, IAs and RAs shall, as a one-time measure, send the Investor Charter to the Investors at their registered email address.

2. Investor Complaints Data to be displayed by IAs and RAs

All the IAs and RAs are required to display the status of Investor Complaints in a format provided by SEBI. Though SEBI registered IAs are already complying with this requirement, the format for such disclosure has been updated. However, it is a new disclosure requirement for RAs.

The format for the same is provided in Annexure- B of the link provided above.

The IAs and RAs are to note the following:

  • The details of the Investor Complaint shall be disclosed by 7th of the succeeding month and it shall be done on a monthly basis.
  • The details shall be displayed on the website and mobile applications of the IAs and RAs.
  • Where the IAs and RAs do not website or mobile application, the status shall be sent to the Investors on their registered email Id, every month.

SEBI demands additional disclosures from Investment Advisors & Research Analysts

3. Other important things to note:

  • the IAs and RAs shall provide a link/option to lodge complaint with them directly on their websites and mobile applications.
  • The IAs and RAs shall also provide a link to the SEBI SCORES website and a link to download the same on the mobile application.
  • The disclosure requirement shall be effective from 1st January 2022.

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In case you have any queries or need professional assistance concerning such disclosure, you may write to me at anjalibansalcs@gmail.com or reach out to me at +91 9148973085.

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