The Recent amendment in SEBI (IA) Regulations, 2013. Too many Individual Investment Advisers give the recommendation but SEBI not accepted and amendment is regulation.

1. Ready4Compliance
SEBI (INVESTMENT ADVISERS), AMENDMENTS,
REGULATIONS, 2020
S.
No.
Particular Information
1 What is name of this amendment? SEBI(Investment Adviser) Amendment, Regulation, 2020
2 What is purpose of these amendments? Protection of Investor’s interest
3 When these amendments are applicable? Within 90 Days
I. NEW TERMINOLOGY
ASSET UNDER ADVICE: - Aggregate net Asset value of securities or
investment product for which the investment adviser has rendered
investment advice.
FAMILY OF CLIENT:-
i. Individual client
ii. Dependent Spouse
iii. Dependent Spouse
iv. Dependent parents
(Note: Independent Spouse, Childers, and Parents are not included)
FAMILY OF AN INDIVIDUAL INVESTMENT ADVISER:-
i. Individual investment adviser
ii. Spouse
iii. Children, and
iv. Parents.
NON-INDIVIDUAL:- means “Body Corporate” including
- Limited liability Partnership
- Partnership Firm
Person Associate with investment advise:-
- Member
- Partner
- Officer
- Directors
- Employee
- Sale Staff , or any person occupying a similar status or
performing a similar function
(Note:- Do not included :- clerical or office administrative
function where there is no client interface.)
Principal Officer:-
- Managing Director
- Designated Director
- Managing partner
- Executive chairmen
- Equivalent management body who is responsible for overall
function of the business and operation.
II. SPECIAL NOTE FOR MUTUAL FUND DISTRIBUTOR
Mutual fund distributor can not use word following words, unless registered with SEBI
- Independent Financial Advisor
- IFA
- Wealth Advisor
- Any other similar name
III. QUALIFICATION REQUIRED
APPLICANT
Individual Body Corporate Partnership Firm and LLP
Individual and All person associated with investment advice Principal officer and All person
associated with investment advice
Principal Officer and All person associated
with investment advice
Applicant, its partner, principal officer and person associated with investment adviser are fit and proper person under schedule II of SEBI
(Intermediaries), Regulations, 2008
Note:
Question 1: In any Body corporate, each member of Board of Directors shall comply regulation 7?
Answer: No, only principal officer or all person(s), who is/are associated with investment advice.
IV. Qualification and certification requirement
Particular Individual Investment
Adviser
Principal Officer Person associated with advice
Qualification - CFA
- Professional qualification

2. - Post-Graduation (Masters’)
- Post-Graduation Diploma (Minimum two Years)
In following Streams
i. Finance
ii. Accountancy
iii. Business management
iv. Commerce
v. Economic
vi. Capital Market
vii. Banking
viii. Insurance
ix. Actuarial Services
Experience 5 Year 2 Years
Certification in
- Financial Planning
- Fund
- Asset
- Portfolio Management
- Investment advisory
services
- NISM
- Any other organization
- Recognized stock exchange
- Financial Planning Board of India
Fresh Certificate Not through CPE
V. NET WORTH
ORGANIZATION
Non – Individual Individual
- Company
- LLP
- Partnership Firm
- Proprietorship
- Individual Investment Adviser
Rs. 50 Lakh Rs. 5 Lakh
WITH IN THREE YEARS
VI. FOR INDIVIDUAL INVESTMENT ADVISER
VII. FEE
Charge fee, specified by the Board.
VIII. CLIENT SEGREGATION
A. In the condition of Individual Investment Adviser (IIA)
CLIENT
Advisory Services Distribution
Individual Investment Adviser Yes No
Family of Individual Investment Adviser Yes No
Total Number
of Client
More than
150
Non indiviual
Registration

3. (Note: If the client get distribution services from any family member of the IIA, then IIA can not provide the advisory services.)
B. In the condition of Non- Individual Investment Adviser
a. Client level segregation at group level for investment advisory and distribution services
Same client cannot be offered both advisory & Distribution services
within the GROUP OF NON – INDIVIDUAL ENTITY
Advisory Client – No Distribution
Distribution Client – No Advisory Fee
Group Means
Holding Company
Investment & Venture Co.
Entity Associate Company
Subsidiary Company
Subsidiary Company
Maintain the arm’s length relationship Between its activities as Investment
Adviser and Distributor
By providing advisory services through a separate identifiable department
and division
Compliance & Monitoring process for client segregation at
group of family level shall be in accordance with the guideline
of the Board.
IX. Implementation of advice or execution
Individual Investment
Adviser
Execution services Through direct mode No commission and fee (Direct or
Indirect)
Through group or family level.
- Investment adviser or group or family of investment adviser shall not charge any implementation fees from the client.
- The client shall not be under any obligation to avail implementation services offered by the investment adviser.
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