Framework for administration and supervision of Research Analysts and Investment Advisers Background
- In terms of Regulation 38A of the ‘SECC Regulations’ notified on April 26, 2024, a recognised Stock Exchange may undertake the activities of administration and supervision over specified intermediaries on such terms and conditions and to such an extent as may be specified. Accordingly, Stock Exchange shall now be recognised as RAASB and IAASB under Regulation 14 of the ‘RA Regulations’ and ‘IA Regulations’ for administration and supervision of Research Analysts (‘RAs’) and Investment Advisers (‘IAs’) respectively. The detailed framework for RAASB and IAASB is specified in Annexure I.
- As per clause (xi) of Regulation 6 of RA Regulations and clause (n) of Regulation 6 of IA Regulations, an applicant seeking registration as RA and IA is required to be enlisted with RAASB and IAASB respectively. The provisions governing enlistment including enlistment of existing RAs/IAs and of applicants whose registration applications are under process as on the effective date of this circular are specified in the enclosed framework.
Repeal and Savings with respect to the erstwhile IAASB framework - From the effective date of this circular, the existing framework for administration and supervision of IAs as specified through SEBI circular number SEBI/HO/IMD/IMD-I/DOF1/P/CIR/2021/579 dated June 18, 2021 and subsequently incorporated under the head “Administration and Supervision of Investment Advisers” of Master Circular for Investment Advisers numbered SEBI/HO/MIRSD-PoD-2/P/CIR/2023/89 dated June 15, 2023 stands rescinded.
- In terms of regulation 30A of IA Regulations, notwithstanding the aforesaid rescission, any action taken or purported to have been taken or any action that may be taken against any person in relation to the membership of IAASB recognised under regulation 14 of IA Regulations, as applicable in the rescinded framework of IAASB, shall be deemed to have been done or taken or may be taken under the corresponding provisions of the amended IA Regulations. Operationalization of RAASB and IAASB framework
- Based on fulfillment of the criteria specified in Annexure I to this circular, a stock exchange shall be granted recognition as RAASB and IAASB. To begin with, in order to ensure efficiency in the system and economies of scale, RAASB and IAASB shall be one and the same stock exchange. Timeline for implementation
- This circular shall become effective on July 25, 2024 (ninetieth day from the date of publication in the Official Gazette of the amendments to RA Regulations made vide the SEBI (Research Analysts) (Amendment) Regulations, 2024 and the amendments to IA Regulations made vide the SEBI (Investment Advisers) (Amendment) Regulations, 2024).
This circular shall become effective on July 25, 2024 (ninetieth day from the date of publication in the Official Gazette of the amendments to RA Regulations made vide the SEBI (Research Analysts) (Amendment) Regulations, 2024 and the amendments to IA Regulations made vide the SEBI (Investment Advisers) (Amendment) Regulations, 2024). - This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with regulation 14 of RA Regulations and IA Regulations to protect the interests of investors in securities market and to promote the development of, and to regulate the securities market.
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