SEBI has issued a circular (rescinding its earlier circular dated December 13, 2021) that mandates Investment Advisers (IAs) to enhance transparency, investor protection, and service standards. The circular introduces a revised Investor Charter (Annexure A) which outlines the vision of promoting informed and secure investing and the mission of enabling investors to choose suitable products, monitor investments, and achieve financial wellness.
It requires IAs to enter into detailed agreements with clients covering fees, conflict disclosures, and confidentiality; perform risk profiling and suitability assessments; disclose complaints and firm details on their websites; employ only certified staff; use official communication channels; maintain records of client interactions; comply with advertisement norms; and avoid discriminatory practices. IAs must also provide disclosures on business affiliations and compensation. The circular is effective immediately and issued under SEBI’s powers to protect investor interests and regulate securities markets.
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