Introduction
The introduction of the Part-Time Research Analyst framework under SEBI (Research Analysts) Regulations, 2014 has allowed several professionals to provide securities research services while continuing their existing professional activities.
Professionals such as:
- Chartered Accountants
- Company Secretaries
- Cost Accountants
- Consultants
- Other eligible professionals
may continue their existing practice while separately undertaking research activities after obtaining SEBI registration.
However, this flexibility comes with an important compliance responsibility:
The professional must clearly distinguish between their SEBI-regulated research activities and their other professional services.
One of the key requirements for Part-Time Research Analysts is the display of a prominent disclaimer while providing invoices or documents relating to their non-research professional activities.
This requirement ensures that clients do not mistakenly believe that:
- Tax services,
- Audit services,
- Consulting services,
- Accounting services,
- Corporate advisory services,
are covered under SEBI Research Analyst regulations.
Why Is a Disclaimer Required for Part-Time Research Analysts?
A Part-Time Research Analyst may simultaneously operate in two different capacities:
Capacity 1 – SEBI Registered Research Analyst
In this role, the person provides:
- Securities research
- Research reports
- Investment recommendations
- Research-related services
These activities are regulated by SEBI.
Capacity 2 – Existing Professional Activity
The same person may also provide:
- Chartered Accountancy services
- Secretarial services
- Tax consultancy
- Business consulting
- Other professional services
These activities are governed by their respective professional frameworks and are not Research Analyst services.
The disclaimer requirement exists to prevent confusion between these two roles.
What Disclaimer Must a Part-Time Research Analyst Provide?
A Part-Time Research Analyst must prominently provide a disclaimer while providing services or raising invoices related to activities outside the scope of SEBI Research Analyst services.
The disclaimer should clearly state that:
- The activity/invoice relates to services outside the purview of SEBI.
- No complaint relating to such services can be raised before SEBI under the Research Analyst framework.
The disclaimer should be:
- Clear
- Prominent
- Easily noticeable
- Presented in a manner that attracts investor attention
Minimum Font Size Requirement
The disclaimer provided by a Part-Time Research Analyst must be displayed prominently.
SEBI requires that such disclaimer should be displayed with:
Minimum font size of 10.
The purpose of this requirement is to ensure that the disclaimer is not hidden in small text or placed in an inconspicuous portion of the invoice.
Where Should the Disclaimer Be Displayed?
The disclaimer should be included on documents relating to non-Research Analyst services.
Examples may include:
- Professional invoices
- Service bills
- Engagement letters
- Other documents issued for non-RA activities
The objective is that the recipient understands the nature of the service being provided.
Example of Non-RA Activities Requiring Disclaimer
A Chartered Accountant registered as a Part-Time Research Analyst may issue invoices for:
- Statutory audit services
- Tax audit services
- GST consultancy
- Income-tax advisory
- Accounting support
- Corporate restructuring consultancy
Such invoices should carry the prescribed disclaimer.
Example Disclaimer Format
A Part-Time Research Analyst may use wording substantially similar to:
"The above services are not covered under the SEBI (Research Analysts) Regulations, 2014 and are not part of Research Analyst services. No complaint relating to the above services can be raised before SEBI under the Research Analyst framework."
The exact wording may be refined based on the professional's circumstances, but the regulatory intent must remain clear.
Does This Disclaimer Apply to Research Service Invoices?
No.
The disclaimer requirement applies specifically to invoices or documents relating to activities outside the scope of Research Analyst services.
For research services, the Research Analyst must comply with separate requirements including:
- Client agreements
- Research disclosures
- Fee disclosures
- Risk disclosures
- SEBI registration details
Difference Between RA Disclosures and Non-RA Disclaimer
A Research Analyst has multiple disclosure obligations.
For Research Services
The RA must disclose:
- SEBI registration details
- Research analyst status
- Risks
- Conflicts of interest
- Financial interests
For Non-RA Professional Services
The professional must clarify:
- The service is not a Research Analyst service
- SEBI RA regulations do not apply
- Complaints cannot be filed with SEBI under the RA mechanism for such services
Importance for Chartered Accountants and Other Professionals
Many professionals operate hybrid practices.
For example:
A Chartered Accountant may provide:
- Audit services
- Tax advisory
- Due diligence
- Financial research
If the professional obtains Part-Time RA registration, each activity must be clearly classified.
Without proper segregation, there may be a risk that clients misunderstand the nature of services.
Common Compliance Mistakes by Part-Time Research Analysts
Not Adding Disclaimer on Professional Invoices
Many professionals assume that SEBI registration only impacts research documents.
However, non-RA service documents also require appropriate clarification.
Using Research Analyst Branding on Non-RA Services
A professional should avoid creating confusion by:
- Using RA terminology on unrelated services
- Marketing non-RA services as investment research
- Combining unrelated service offerings
Mixing Fees Received for Different Services
Separate accounting records should ideally be maintained for:
- Research service income
- Professional service income
This helps demonstrate regulatory segregation.
Providing Investment Advice Through Non-RA Engagements
A Part-Time RA should ensure that other professional services do not indirectly become:
- Investment advice
- Portfolio management
- Securities recommendation services
Such activities may trigger separate regulatory requirements.
Recommended Compliance Framework for Part-Time Professionals
Professionals operating as Part-Time RAs should maintain:
Separate Engagement Documentation
Maintain separate agreements for:
- Research services
- Other professional services
Separate Billing Structure
Invoices should clearly identify:
- Nature of service
- Applicable regulatory framework
- Relevant disclosures
Separate Communication Channels
Where practical, maintain distinction between:
- Research communications
- Professional service communications
Internal Compliance Review
Periodically review:
- Website content
- Marketing material
- Invoice formats
- Client communications
to ensure proper segregation.
Impact on Professional Firms
Where a professional firm has multiple partners or members, the firm should carefully evaluate:
- Which individuals are registered as RAs
- Which services are being provided
- Whether the firm name creates confusion
- Whether separate branding or disclosures are required
Regulatory clarity becomes increasingly important as professional firms expand into capital market-related services.
Practical Example
A CA firm has a partner who is registered as a Part-Time Research Analyst.
The firm provides:
- Audit services
- Tax advisory
- Financial modelling
- Equity research reports
For audit and tax invoices:
The firm should include the Part-Time RA disclaimer wherever applicable.
For research reports:
The firm must comply with SEBI RA disclosure requirements.
The two activities should not be mixed.
Compliance Checklist for Part-Time RA Disclaimer Requirement
A Part-Time Research Analyst should verify:
- Disclaimer included on non-RA invoices
- Minimum 10 font size followed
- Disclaimer is prominently displayed
- Research and non-research services are segregated
- Separate documentation maintained
- Client communications clearly identify service nature
Conclusion
The disclaimer requirement for Part-Time Research Analysts is a critical investor protection measure.
It ensures that clients clearly understand whether they are receiving:
- SEBI-regulated research services; or
- Other professional services outside the Research Analyst framework.
Professionals adopting the Part-Time RA model must carefully maintain segregation between their professional practice and research activities.
A properly designed compliance framework helps professionals expand into securities research while maintaining regulatory clarity and avoiding unnecessary compliance risks.
How Anuj Desai & Associates Can Assist
Anuj Desai & Associates assists professionals with:
- Part-Time Research Analyst registration advisory
- SEBI compliance framework implementation
- Invoice and disclosure review
- Research Analyst SOP preparation
- Professional practice restructuring
- Regulatory documentation support
- Annual compliance audit assistance