SEBI issued the Most Important Terms and Conditions (MITC) for Investment Advisers.
The MITC shall be informed by the IAs to the clients via email or any other suitable mode of communication (which can be preserved) by June 30, 2025.
Most Important Terms and Conditions (MITC)
IA only accepts payments for advisory fees, not funds/securities on behalf of clients.
IA does not assure returns or risk-free investments; all advice is subject to market risks.
Assured/fixed returns schemes are illegal and will not be offered by IA.
IA’s advice on securities falls under SEBI; non-SEBI products require client disclosures and acknowledgments.
IA cannot execute trades without the client’s explicit consent for each transaction.
The current fee limit under Fixed Fee mode is Rs 1,51,000/- per annum per family of client. Under Assets under Advice (AUA) mode, maximum fee limit is 2.5 per cent of AUA per annum per family of client. The IA may change the fee mode at any time with the client’s consent; however, the maximum fee limit in such cases shall be higher of fee limit under the fixed fee mode or 2.5 per cent of AUA per annum per family of client
IA may charge fees in advance with client consent, but not for more than two quarters as per SEBI norms. If IA services are terminated prematurely, the client is entitled to a refund for the unexpired period, minus a maximum breakage fee equal to one-quarter’s fee
Fees to IA may be paid by the client through only cheque, bank transfer, UPI, or CeFCoM; no cash payments allowed.
To provide effective services, IA requires the client to share relevant financial details such as income, existing investments, and liabilities.
IA must conduct risk profiling before and during service provision and communicate the assessed risk profile.
IA and related entities cannot provide distribution services; direct plans (non-commission) are preferred.
Grievances:
Step 1: Contact IA (as per Grievance Redressal Matrix).
Step 2: Escalate to SEBI via SCORES (www.scores.sebi.gov.in).
Step 3: Use Online Dispute Resolution (ODR) via https://smartodr.in.
SEBI registration and certifications do not guarantee IA performance or returns.
Clients must keep their contact details up-to-date with IA.
IA will never ask for login credentials or OTPs; do not share these with anyone, including IA.
The provisions of this circular shall come into force with immediate effect.
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