Investor Charter for Research Analysts
Summary
This circular mandates the modification of the Investor Charter for Research Analysts to enhance financial consumer protection and literacy. It directs BSE Limited, acting as the RAASB, to ensure Research Analysts disseminate this charter to all clients through various digital and physical channels. Additionally, it requires continuous transparency regarding investor grievance data and rescinds previous related circulars. This section outlines investor rights regarding grievance redressal, exit mechanisms, and protection against unfair clauses. It details specific responsibilities for investors, including verifying SEBI registration and avoiding prohibited actions like sharing login credentials. Finally, it mandates Research Analysts to display monthly complaint data and disposal trends in standardized formats.
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In a move to enhance financial consumer protection alongside enhanced financial inclusion and financial literacy and in view of the recent developments in the securities market including introduction of Online Dispute Resolution (ODR) platform and SCORES 2.0, it has been decided to modify the investor charter for Research Analysts.
BSE Limited (presently recognized as RAASB) is directed to advise Research Analysts to bring the Investor Charter to the notice of their clients (existing as well as new clients) through disclosing the Investor Charter on their respective websites and mobile applications (if any), making them available at prominent places in the office, provide a copy of Investor Charter as a part of client on-boarding process, through e-mails/ letters etc.
all the Research Analysts shall continue to disclose on their respective websites and mobile applications (if any), the data on complaints received against them or against issues dealt by them and redressal thereof, latest by 7th of succeeding month, as per the format enclosed at Annexure ‘B’ to this circular.
The provisions of this circular shall come into force with immediate effect.
With the issuance of this circular, SEBI, Circular No. SEBI/HO/IMD/IMD-II CIS/P/CIR/2021/0685 dated December 13, 2021 stands rescinded and Clause 5 of Master Circular for Research Analysts dated May 21, 2024 stands amended as per this circular.
This circular is issued in exercise of powers conferred under Section 11(1) of Chapter IV of the Securities and Exchange Board of India Act, 1992 read with Regulation 24(9) of the SEBI (Research Analysts) Regulations, 2014 to protect the interests of investors in securities and to promote the development of, and to regulate the securities markets and shall come into effect from the date of this circular.
To publish research report based on the research activities of the RA; To provide an independent unbiased view on securities; To offer unbiased recommendation, disclosing the financial interests in recommended securities; To provide research recommendation, based on analysis of publicly available information and known observations; To conduct audit annually; To ensure that all advertisements are in adherence to the provisions of the Advertisement Code for Research Analysts; To maintain records of interactions, with all clients including prospective clients (prior to onboarding), where any conversation related to the research services has taken place.
Onboarding of Clients: Sharing of terms and conditions of research services; Completing KYC of fee paying clients; Disclosure to Clients: To disclose, information that is material for the client to make an informed decision... To disclose the extent of use of Artificial Intelligence tools... To distribute research reports and recommendations to the clients without discrimination; To maintain confidentiality w.r.t publication of the research report until made available in the public domain; To respect data privacy rights of clients... To disclose the timelines for the services provided... To provide clear guidance and adequate caution notice... To treat all clients with honesty and integrity.
Investor can lodge complaint/grievance against Research Analyst... approach the concerned Research Analyst who shall strive to redress the grievance immediately, but not later than 21 days of the receipt of the grievance. Mode of filing the complaint on SCORES or with Research Analyst Administration and Supervisory Body (RAASB): i. SCORES 2.0... ii. Email to designated email ID of RAASB.
If the Investor is not satisfied with the resolution provided by the Market Participants, then the Investor has the option to file the complaint/ grievance on SMARTODR platform for its resolution through online conciliation or arbitration.
Right to be Heard and Satisfactory Grievance Redressal; Right to have timely redressal; Right to Exit from Financial product or service in accordance with the terms and conditions agreed with the research analyst; Right to receive clear guidance and caution notice when dealing in Complex and High-Risk Financial Products and Services; Additional Rights to vulnerable consumers - Right to get access to services in a suitable manner even if differently abled; Right to provide feedback on the financial products and services used; Right against coercive, unfair, and one-sided clauses in financial agreements
Always deal with SEBI registered Research Analyst.
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Source: SecMarx — Investor Charter for Research Analysts. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.