SEBI mulls common ad code for market intermediaries
SEBI on Tuesday proposed allowing market intermediaries, including stock brokers, mutual fund houses, investment advisors and portfolio managers, to engage celebrities for promoting their brands or entity name, while prohibiting endorsements of specific products or services. The proposal is part of a consultation paper on a Common Advertisement Code (CAC) for specified Sebi-regulated entities, aimed at harmonising advertising norms, reducing compliance burdens and strengthening investor protection.
Under the proposed framework, celebrity endorsements would be permitted only at the regulated entity’s brand or corporate level, subject to prescribed conditions and appropriate disclaimers. Celebrities would not be allowed to endorse specific investment products or services offered by such entities. At present, celebrity endorsement is permitted at the industry level in AMC with prior approval from the Securities and Exchange Board of India (SEBI).
The capital market watchdog has also proposed replacing the existing requirement of prior approval for advertisements by stock brokers, Online Bond Platform Providers (OBPPs), investment advisors (IAs) and research analysts (RAs) with a post-issuance reporting mechanism. Advertisements would need to be reported to relevant stock exchange or SEBI-recognised supervisory body within 24 hours of their issuance, after which they would be subject to monitoring.
