SEBI Proposes Body Corporate for Administration & Supervision of Research Analysts

On August 22, 2023, the Securities and Exchange Board of India (SEBI) released a consultation paper proposing the recognition of a body corporate for the administration and supervision of Research Analysts (RAs) in light of the evolving nature of their businesses. The said body would be designated as the Research Analyst Administration and Supervisory Body (RAASB).

In accordance with Regulation 14 of the Securities and Exchange Board of India (Investment Advisers) Regulations, 2013, SEBI had recognised an entity known as the Investment Adviser Administration and Supervisory Body (IAASB) for the administration and supervision of Investment Advisers (IAs). In June 2021, the BSE Administration & Supervision Limited was granted recognition as the (IAASB) for a period of three years.

The Securities and Exchange Board of India (Research Analysts) Regulations, 2014, which is similar to the IA Regulations provides that SEBI may recognise any body or body corporate for the administration and supervision of RAs on the specified terms and conditions. Additionally, it states that SEBI may determine that a person cannot act as an RA unless he is a member of a recognised body or body corporate.

It is clarified that the member RAs will not incur any additional costs for the proposed corporate body. The plan is to rationalise the application cost and registration fee currently outlined in the RA Regulations. Also, the Board has proposed the amendment of RA Regulations to mandate membership of RAASB as one of the criteria for consideration of grant of certificate of registration as an RA.

The Board has sought public comments on this proposal by September 12, 2023.