The Securities Exchange Board of India (SEBI), on January 29, 2025, issued clarifications on provisions related to association of persons regulated by the Board, MIIs, and their agents with persons engaged in prohibited activities.
SEBI has published amendments to key regulations, including the Securities and Exchange Board of India (Intermediaries) (Amendment) Regulations, 2024, the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Fourth Amendment) Regulations, 2024, and the Securities and Exchange Board of India (Depositories and Participants) (Second Amendment) Regulations, 2024, in the Official Gazette on August 29, 2024. These regulations prohibit SEBI-regulated entities, market infrastructure institutions (MIIs) such as stock exchanges, clearing corporations, depositories, and their agents from associating with any person providing investment advice or making performance claims unless they are registered or authorized by SEBI. However, entities engaged solely in investor education, without offering advice or making performance claims, are exempt. To aid compliance, SEBI has issued detailed clarifications in the form of FAQs, included in Annexure A. This circular is issued under SEBI’s regulatory powers to protect investors, promote market development, and regulate the securities market.
[Notification No. SEBI/HO/MIRSD/ MIRSD-PoD-1/P/CIR/2025/11]
