SEBI has introduced a unified Common Advertisement Code for brokers, mutual funds, analysts, and portfolio managers. The code regulates promotional content, including celebrity endorsements, to prevent misleading claims and ensure investor protection.
SEBI Introduces Common Advertisement Code for Intermediaries
Pursuant to the SEBI (Intermediaries) Regulations, 2025, the regulator introduced a Common Advertisement Code effective November 2026, applicable across all specified regulated entities (SREs), including brokers, research analysts, portfolio managers, and mutual funds. The code replaces fragmented advertising guidelines and standardizes disclosure requirements, risk disclaimers, and content accuracy norms.
The code explicitly regulates the use of celebrity endorsements, requiring celebrities to verify the fairness of claims in advertisements. It mandates prompt reporting of misleading communications within three working days and introduces PaRRVA (Presentation Risk and Regulatory Viability Assessment) ratings for digital campaigns. The framework also prohibits exaggerated performance projections and ensures back-testing transparency.
With the Fifth Schedule of the Mutual Funds Regulations being replaced, compliance officers must update their review processes. The unified code is expected to reduce regulatory arbitrage and strengthen investor confidence, particularly in digital and social media promotions. Enforcement will be monitored through SEBI’s surveillance and inspection mechanisms.
Citations
- SEBI (Intermediaries) Regulations, 2025, Fifth Schedule (as amended 2026)
