Research reports are not ads, clarifies SEBI

The Securities and Exchange Board of India (Sebi) clarified on Thursday that research reports and recommendations provided by research analysts (RAs) are not considered advertisements, unless they contain promotional material for products or services offered by the analysts, as per reports.

This announcement follows queries Sebi received regarding the applicability of advertisement code provisions on research reports issued by RAs.

According to a Sebi circular, the advertisement code applies to communications such as pamphlets, circulars, brochures, notices, or any other literature designed for publication in print or electronic media. This includes displays on platforms like newspapers, magazines, hoardings, or various audio-visual channels like television and motion pictures.

The regulator underscored that a research report, regardless of how it reaches an investor or potential investor, will be treated as an advertisement only if it explicitly or implicitly promotes products or services offered by the research analyst.

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