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Advertisement Code for Investment Advisers and Research Analysts

SEBI in its circular released on 5th April, 2023 has introduced Advertisement Code for the Investment Advisers (RIAs) and Research Analyst (RAs). All SEBI registered IAs and RAs are required to comply with the same.

The circular will be effective from May 1, 2023.

With this code SEBI has specified which form of communication shall be treated as advertisement, the disclosures to be provided, Do’s and Dont’s thereof.

Let’s simplify the Code:

1. What is an advertisement?

All forms of communication which has the capacity to influence the decisions of any investor or prospective investors shall be treated as advertisement.

# forms of communications shall include pamphlets, circulars, brochures, notices, research reports or any other literature, document, information or material published, or designed for use in any publication or displays (such as newspaper, magazine, sign boards/hoardings at any location), in any electronic, wired or wireless communication (such as electronic mail, text messaging, messaging platforms, social media platforms, radio, telephone, or in any other form over the internet) or over any other audio-visual form of communication (such as television, tape recording, video tape recordings, motion pictures) or in any other manner whatsoever.

2. What are the disclosures/information to be made in the advertisement?

The IA and RA may choose to advertise in any form mentioned above, however, such advertisement shall include the following information/disclaimers:

  • Name as registered with SEBI, registered office address, SEBI registration number, logo/brand name/trade name of IA/RA and CIN of the IA/RA if applicable.

  • Declaration that information is accurate, true and complete in unambiguous and concise language.

  • Standard warning with minimum 10 font size which states-

Investment in securities market are subject to market risks. Read all the related documents carefully before investing.”.

In case of-

o audio- visual media-based advertisement, the standard warning in visual media based advertisement and accompanying voice over reiteration shall be audible in a clear and understandable manner.

o advertisement is being issued in a language other than English, it shall ensure that the standard warning is accurately translated in the language of the advertisement.

  • Where the advertisement is done through SMS/Message/Pop-up, social media etc., then an official hyperlink disclosing all the above details shall be sent.

  • Disclaimers-

o "The securities quoted are for illustration only and are not recommendatory" should be mentioned where any specific securities are displayed.

o “Registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.” should be mentioned while advertising or communicating with the clients.

3. What is prohibited while advertising?

The IAs and RAs should ensure that the advertisement should not contain-

  • Anything which is prohibited for publication under the law.

  • Statements which are false, misleading, biased or deceptive, based on assumptions or projections.

  • Any misleading or deceptive testimonials.

  • Statements which, directly or by implication or by omission, may mislead the investor.

  • Any statement likely to be misunderstood or likely to disguise the significance of the same or any other statement contained in the advertisement.

  • Any statement designed to exploit the lack of experience or knowledge of the investors.

  • Any statement that is exaggerated or is inconsistent with or unrelated to the nature and risk and return profile of the product.

  • Extensive use of technical or legal terminology or complex language and the inclusion of excessive details which may distract the investors.

  • Reference to any report, analysis, or service as free, unless it actually is free and without condition or obligation.

  • Any promise or guarantee of assured or risk free return to the investors.

The advertisement shall not imply any assured returns or minimum returns or target return or percentage accuracy or service provision till achievement of target returns or any other nomenclature that gives the impression to the client that the investment advice/recommendation of research report is risk-free and/or not susceptible to market risks and/or that it can generate returns with any level of assurance.

  • Any statement which directly or indirectly discredits other advertisements or intermediaries or makes unfair comparisons or ascribes any qualitative advantage over other intermediaries directly or indirectly.

  • Reference to past performance of the IA/RA.

  • Superlative terms such as “Best”, “No. 1”, Top Adviser/Research Analyst, “Leading”, “One of the best amongst market leaders”, etc. so as to provide any endorsement of quality or standing of the IA/RA.

However, factual details of awards received by the IA/RA from independent organizations may be included.

  • Advertisements shall not include SEBI Logo.

4. What are the other requirements under Advertisement Code?

  • Prior approval for the advertisement shall be obtained from SEBI recognized supervisory body (eg: BASL in case of IAs) before issue.

The circular does not specify if the RAs need to procure such approval, however we assume that SEBI may issue another circular for the same. For now, RAs can have some relief.

  • In the event of suspension of any IA/RA by SEBI and/or by SEBI recognized supervisory body, the IA/RA so suspended shall not issue any advertisement either singly or jointly with any other IA/RA, during the period of suspension.

  • The IA/RA shall not engage in games, leagues, schemes, competition etc. which may involve distribution of prize monies, medals, gifts, etc.

  • These advertisement norms shall be applicable to any other investment/research/consultancy agency associated with the IA/RA concerned and issuing advertisement wherein the IA/RA has been named in the advertisement.

  • Copy of the advertisement shall be retained by IA/RA for a period of five years.

With these advertisement code, we can understand that SEBI has not restricted the IAs and RAs from advertising but has provided a road map that shall be followed while advertising. The IAs and RAs shall ensure that the code of advertisement is followed in all forms of communication as defined by SEBI.

In case of any queries or clarifications, please write to me at

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