SEBI extends advance fee-collection limits for Research Analysts, Investment Advisers to one year

Several RAs had announced that the guidelines had made their business unviable and had asked the regulator to relax some of the norms.

The market regulator relaxed norms around advance fee collection for research analysts (RAs) and investment advisers (IAs), and have allowed both registered entities to collect fee for a year in advance.

In a press statement released after meeting with its Board on March 24, the Securities and Exchange Board of India (SEBI) stated, "If agreed by the client, IAs and RAs may charge fee in advance upto a period of one year. Earlier IAs and RAs were allowed to charge advance fee for a maximum period of two quarters and one quarter respectively."

It had been an ask from the RAs and IAs soon after the January 8 guidelines were released.

Several RAs had announced that the guidelines had made their business unviable and the one that they found particularly difficult to comply with was the three-month limit on advance fee collection. Moneycontrol had reported that the regulator had taken this feedback and would reconsider it, and soon a consultation paper was released to this effect. The whole debate was expected to find a resolution after this board meeting.

(This copy will be updated.)