SEBI requires research analysts and investment advisers to put a standard set of Most Important Terms and Conditions, the MITC, in front of every client before any service or fee. The requirement comes from circulars dated 17 February 2025, now in the master circulars of 6 February 2026. RAs need client consent to the terms, while IAs need a signed agreement that the client has received.
Consent for RAs, a signed agreement for IAs
For RAs, Regulation 24(6) and para 1.12 and Annexure B of the RA Master Circular require disclosure of the minimum mandatory terms and the standard MITC, and client consent before giving any research service or charging any fee. This came from circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/20 dated 17 February 2025.
For IAs, Regulation 19(1)(d) and para 1(ii) and Annexures A and B of the IA Master Circular require a signed agreement containing the Annexure A terms and the MITC. No advice may be given and no fee charged until the client has signed and received a copy. This came from circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/19 of the same date.
RA and IA requirements compared
The table sets the two regimes side by side. The main difference is the client action: an RA collects consent to its terms, while an IA needs a signed agreement that the client has received before any advice or fee. The MITC is standard for each group.
| Point | Research analyst | Investment adviser |
|---|---|---|
| Document | Terms with Annexure B and standard MITC | Agreement with Annexure A and standard MITC |
| Trigger | Before any research service or fee | Before any advice or fee |
| Client action | Consent | Signature and receipt of a copy |
| Source | RA Master Circular para 1.12, Annexure B | IA Master Circular para 1(ii), Annexures A and B |
What the MITC must say
The MITC sets out in plain words what the client can and cannot expect. It covers fees and limits, payment channels, refunds, the grievance route and safety statements. Use the standard text rather than a paraphrase, because the auditor will compare it with the annexure.
- No assurance of returns, and investments are subject to market risk
- The RA or IA cannot execute trades without the client's consent
- The RA or IA does not handle client funds or securities
- No assured or fixed return schemes, which are prohibited by law
- The RA or IA will never ask for login credentials or OTPs
- Grievance steps with SCORES and SMART ODR
Fee and refund clauses
For RAs, MITC clause 12(ii) carries the ₹1,51,000 per year per family limit and clause 12(iv) the payment rules. Advance fees cannot exceed one year, with pro rata refunds and no breakage fee. BSE notice 20250430-16 dated 30 April 2025 asked RAs to update the advance fee clause, because Annexure B still says one quarter.
For IAs, MITC clause 6 covers the AUA and fixed fee modes, clause 7 covers advance fees and refunds, and clause 11 covers segregation from distribution. The breakage fee may not exceed one quarter's fee. Both sets of terms must also include guidance on BSE's optional CeFCoM.
Other terms to include
Both RAs and IAs must disclose the extent to which they use AI tools when sharing terms or signing the agreement. IAs advising on products outside SEBI's purview must disclose this under MITC clause 4 and take a client declaration that SEBI offers no recourse for them. Annexure A clause 14 for IAs makes clear there is no power of attorney.
Getting consent and signatures
Collect signed or e-signed consent before onboarding or invoicing, and keep a dated record of when the terms or agreement were sent. For existing RA clients who joined before the standard MITC, get consent again at renewal or at the next fee date. IAs should record the date the copy of the agreement was given to the client.
The terms, consents and agreements form part of the records that must be kept for at least five years. Store them against the client's PAN with the date of consent or signature, so that the record can be found quickly during an audit or a complaint.
Common gaps
Look out for an old advance fee clause that still says one quarter, a missing CeFCoM paragraph, paraphrased safety statements and a missing AI disclosure. Each is a quick fix once found. For help checking terms against the standard text, XDQ Labs offers XDQ xAgents for RAs and IAs (/product/xfintech-agents/). This guide is general information, not legal or investment advice. Confirm with your compliance officer.
Frequently asked questions
What is MITC for a SEBI research analyst?
MITC stands for Most Important Terms and Conditions. RAs must disclose the standard MITC and the minimum mandatory terms in Annexure B of the RA Master Circular, and get client consent before giving any research service or charging any fee.
Does an investment adviser need a signed agreement?
Yes. An IA must sign an agreement with each client containing the Annexure A terms and the standard MITC, and must not give advice or charge a fee until the client has signed and received a copy.
Do institutional clients need to consent to RA terms?
For institutional investors and QIBs, consent to the RA terms is optional, but the RA must still disclose the terms. This is set out in para 28(ii)(b) of the RA Master Circular.
What safety statements must the MITC contain?
That the RA or IA cannot execute trades without consent, does not handle client funds or securities, offers no assured or fixed return schemes, and will never ask for login credentials or OTPs.
Sources
- Master Circular for Research Analysts, 6 February 2026, SEBI, 2026
- Master Circular for Investment Advisers, 6 February 2026, SEBI, 2026
- SEBI (Research Analysts) Regulations, 2014, amended up to 10 October 2026, SEBI, 2026
- SEBI (Investment Advisers) Regulations, 2013, amended up to 25 November 2025, SEBI, 2025
- RAASB and IAASB enlistment portal, BSE Limited, 2026
