TaxTMI 
TaxTMI 
Securities and Exchange Board of India (Research Analysts) (Third Amendment) Regulations, 2024.
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.... and before clause (g), the following clauses shall be inserted, namely: - "(fa) "consideration" means any form of economic benefit including non-cash benefit, received or receivable, directly or indirectly, in any form whether from client or otherwise for providing research services; (fb) "family of an individual research analyst" shall include individual research analyst, spouse, children and parents; (fc) "family of client" shall include individual client, dependent spouse, dependent children and dependent parents;" (2) after clause (n) and before clause (o), the following clauses shall be inserted, namely: - "(na) "non-individual" means a body corporate including a limited liability partnership and a partnership firm; (nb) "other business activity or employment" means such business activity or employment which is not related to securities and: a. it does not involve handling or managing of money or funds of client or person; or b. it is not related to providing advice or recommendation to any client or person in respect of any products or assets for investment purposes; (nc) "partner" means partner....
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....ion as a research analyst in the form of a limited liability partnership or a body corporate within such time as may be specified by the Board. Explanation. - The provisions of sub clause (i) shall also be applicable to the principal officer of a non-individual entity registered both as a research analyst and an investment adviser but engaged in no other business activity." (4) in clause (t), after the words "independent research analyst" and before the words "or individual research analyst", the words and symbol "or part-time research analyst", shall be inserted. (5) clause (u) shall be substituted with the following: "(u) "research analyst" means a person who, for consideration, is engaged in the business of providing research services and includes a part-time research analyst;" (6) after clause (w) and before clause (x), the following clause shall be inserted, namely: - "(wa) "research services" means the following services provided by research analyst: i. preparation or publication of the research report or content of the research report; or ii. providing or issuing research report or research analysis; or ....
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....the applicant is a partnership firm or a limited liability partnership, the principal officer, partners engaged in issuance of research report or research analysis and all person associated with research services are appropriately qualified and certified as specified in regulation 7;" (5) in clause (v), after the words "as research analyst" and before the words "are qualified", the words "and all persons associated with research services" shall be inserted; (6) in clause (vi), the words "capital adequacy" shall be substituted with the word "deposit"; (7) in clause (vii), after the words "research analyst" and before the words "and partners of the applicant", the words and symbol ", persons associated with research services" shall be inserted. IV. regulation 7 shall be substituted with the following, namely: - "Qualification and certification requirement. 7. (1) An individual research analyst or a principal officer of a non-individual research analyst registered under these regulations, individuals employed as research analyst and partners of a research analyst, if any, engaged in research services shall have the following m....
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....esolution Mechanism or such other mechanism as may be specified by the Board." VI. in regulation 9, (1) after the words "Form B" and before the words "under First Schedule", the words and symbols "to a research analyst or in Form C to a part-time research analyst, as the case may be" shall be inserted; (2) the symbol "." shall be substituted with the symbol ":"; (3) the following proviso shall be inserted, namely: - "Provided that an individual or partnership firm registered as an investment adviser may also be granted certificate of registration as a research analyst, subject to such terms and conditions as the Board may deem fit and appropriate." VII. in regulation 13, (1) in clause (iii), (a) the symbol "." shall be substituted with the symbol ":"; (b) the following proviso shall be inserted, namely: - "Provided that part-time research analyst registered under these regulations shall use the term 'part-time research analyst' in all correspondences with its clients." (2) after clause (iii), the following clause shall be inserted, namely: - "(iv) the number of clients of a p....
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....e of the scale and scenario of adoption of such tools, for servicing its clients shall be solely responsible for the security, confidentiality and integrity of the client data, use of any other information or data for research services, research services based on output of Artificial Intelligence tools and compliance with any law for the time being in force. (8) Research analyst or research entity engaged in providing model portfolio shall abide by the guidelines issued by the Board from time to time." XIV. in regulation 25, (1) in sub-regulation (1), after clause (iv), the following clauses shall be inserted, namely: - "(v) Know Your Client records of the fee paying client; (vi) a register or record containing list of the clients along with client's PAN, the date and nature of the research service, details of the products/securities for which research service was provided and fee/consideration, if any charged/received for such research service; (vii) records of communication including emails, call recordings etc. with all clients including prospective clients in such manner as may be specified; (viii) the terms and con....
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....ibution services. Explanation. - (i) The same client cannot be offered both research and distribution services within the group of the non-individual entity. (ii) A client can either be receiving research services where no distributor consideration is received at the group level or distribution services where no research services fee is collected from the client at the group level. (iii) 'Group' for this purpose shall mean an entity which is a holding, subsidiary, associate, subsidiary of a holding company to which it is also a subsidiary, an investing company or the venturer of the company as per the provisions of Companies Act, 2013 for nonindividual research analyst or research entity which is a company under the said Act and in any other case, an entity which has a controlling interest or is subject to the controlling interest of a non-individual research analyst. (4) Non-individual research analyst or research entity shall maintain an arm's length relationship between its activities as research analyst and distributor by providing research services through a separately identifiable department or division. (5) Compliance and....
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....y: - "(d) Number of persons associated with research services employed by the applicant who shall engage in research analysis and/or research report preparation under these regulations on behalf of the applicant. (Provide details thereof, including self certified copies of supporting documents in respect of qualification for such persons associated with research services employed)." iii. clause (e) shall be substituted with the following, namely: - "(e) Declaration by the applicant that the principal officer, persons associated with research services employed and partner who renders research services, of the applicant, if any, currently comply with the qualification requirements under regulation 7." iv. clause (f) shall be substituted with the following, namely: - "(f) Declaration by the applicant that it shall ensure that the principal officer, persons associated with research services employed and partner who renders research services, of the applicant, if any, comply with the certification and qualification requirements under the regulation 7 at all times including obtaining fresh certification before expiry of existing certification.....
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.... certificate of registration shall be valid till it is suspended or cancelled by the Board Date: Place: MUMBAI By Order Sd/- For and on behalf of Securities and Exchange Board of India" PRAMOD RAO, Executive Director [ADVT.-III/4/Exty./763/2024-25] Footnotes: 1. The Securities and Exchange Board of India (Research Analysts) Regulations, 2014, were published in the Gazette of India on September 01, 2014 vide No. SEBI/LAD-NRO/GN/2014-15/07/1414. 2. The Securities and Exchange Board of India (Research Analysts) Regulations, 2014 were subsequently amended on, - a. 8th December, 2016 by the Securities and Exchange Board of India (Change in Conditions of Registration of Certain) (Amendment) Regulations, 2016 vide notification No. SEBI/LADNRO/GN/2016-17/023. b. 17th April, 2020 by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2020 vide notification No. SEBI/LAD-NRO/GN/2020/10. c. 16th March, 2021 by the Securities and Exchange Board of India (Research Analysts) (Amendment) Regulations, 2021 vide notification No. SEBI/LAD-NRO/GN/2021/09. ....