भारतीय (cid:366)ितभूित और िविनमय बोड(cid:330)
Securities and Exchange Board of India
CIRCULAR
SEBI/HO/MIRSD/ MIRSD-PoD/P/CIR/2025/48 April 02, 2025
To,
All Registered Investment Advisers
All Registered Research Analysts
BSE Limited (Administration and Supervisory Body for Investment Advisers and
Research Analyst – IAASB and RAASB)
Sir / Madam,
Sub: Relaxation of provision of advance fee restrictions in case of Investment
Advisers and Research Analysts
1. Pursuant to the changes in SEBI (Research Analysts) Regulations, 2014 in
December 2024, Securities and Exchange Board of India (SEBI), received
representations regarding the restriction on advance fee for three months only which
was allowed to be charged by Research Analysts (RAs). It had been represented
that three months provision inter alia disincentivized RAs from offering long term
recommendations. Similar representations were received by SEBI from Investment
Advisers (IAs) regarding the restriction on advance fee for two quarters only which
was allowed to be charged by IAs.
2. SEBI considered this feedback and floated a consultation paper to increase the
period of advance fee for one year by both IAs and RAs.
3. It has now been decided to relax this particular provision. IAs and RAs shall now
ensure compliance with the following fee related provisions:
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भारतीय (cid:366)ितभूित और िविनमय बोड(cid:330)
Securities and Exchange Board of India
i. If agreed by the client, IAs and RAs may charge fees in advance, however, such
advance shall not exceed fees for a period of one year.
ii. The fee related provisions such as fee limit, modes of payment of fees, refund of
fees, advance fee, breakage fees shall only be applicable in case of their
individual and Hindu Undivided Family (HUF) clients (provided these clients are
not accredited investors). These provisions shall not be applicable in case of
non-individual clients, accredited investors, and in case of institutional investors
seeking recommendation of proxy adviser.
iii. In case of non-individual clients, accredited investors, and in case of institutional
investors seeking recommendation of proxy adviser, fee related terms and
conditions shall be governed through bilaterally negotiated contractual terms.
4. The provisions of this circular shall come into effect from the date of issuance of this
circular.
5. IAASB/RAASB (BSE Limited) is hereby directed to bring the provisions of this
circular to the notice of the IAs and RAs.
6. 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 15A of SEBI
(Investment Advisers) Regulations, 2013 and regulation 15A of SEBI (Research
Analysts) Regulations, 2014, to protect the interests of investors in securities market
and to promote the development of, and to regulate the securities market.
7. This circular is available on the SEBI website at www.sebi.gov.in under the category
"Legal Circulars".
Yours faithfully,
Aradhana Verma
General Manager
Tel. No. 022-26449633
aradhanad@sebi.gov.in
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