SEBI issued Relaxation of provision of advance fee restrictions in case of Investment Advisers and Research Analysts.
It has now been decided to relax this particular provision. IAs and RAs shall now ensure compliance with the following fee related provisions
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.
The provisions of this circular shall come into effect from the date of issuance of this circular.
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