SEBI Master Circular 2026 for Investment Advisers – Fees | AUA | Disclosures

MASTER CIRCULAR HO/38/12/11(2)2026-MIRSD-POD/I/4300/2026; Dated: 06.02.2026

The Securities and Exchange Board of India (SEBI) has issued the 2026 Master Circular for Investment Advisers (IAs) with the objective of consolidating and updating earlier circulars into a single, comprehensive regulatory framework.

The Master Circular aims to enhance regulatory clarity, investor protection, and ease of compliance, while aligning the advisory ecosystem with evolving market practices.

1. Flexible Fee Structure with Revised Fee Cap

SEBI has provided flexibility in fee charging modes for Investment Advisers, while retaining an overall cap to protect investors.

Key provisions include:

• Investment Advisers may continue to follow per-family fee-based models
• The maximum fee cap is ₹1.51 lakh per family per annum
• Fee structures must be transparent and clearly disclosed to clients

2. Strengthened Documentation for Assets Under Advice (AUA)

To enhance regulatory oversight and prevent misreporting, the Master Circular strengthens documentation requirements relating to Assets Under Advice (AUA):

• Investment Advisers must maintain robust documentary evidence to substantiate AUA
• Records must be verifiable and available for inspection by SEBI
• This measure seeks to ensure accuracy in reporting and fair application of fee norms

3. Charging for Second Opinion Services

SEBI has clarified that:

• Investment Advisers are permitted to charge fees for providing second opinion services
• Such services must be rendered only with the explicit consent of the client
• The scope, nature, and fee for second opinion services must be clearly documented and disclosed

4. Alignment with the Revised Investor Charter

The Master Circular aligns IA obligations with the revised Investor Charter, particularly in relation to disclosures covering:

• Scope and nature of advisory services
• Fee structure and charges
• Risk profiling methodology
• Grievance redressal and complaint handling mechanisms

This alignment is intended to improve investor awareness, transparency, and trust.

5. Consolidation and Rescission of Earlier Circulars

SEBI has clarified that:

• Earlier circulars covered under the Master Circular stand rescinded
• However, actions taken, penalties imposed, and proceedings initiated under the earlier circulars remain valid

This ensures continuity of enforcement while simplifying the regulatory framework.

6. Key Takeaway

The 2026 Master Circular:

• Provides a single-point reference for IA compliance
• Balances fee flexibility with investor protection
• Strengthens documentation and disclosure standards
• Aligns advisory practices with SEBI’s enhanced investor protection framework

Click Here To Read The Full Circular