The Securities and Exchange Board of India (SEBI) has proposed to allow regulated entities, including stock brokers, mutual fund houses, investment advisers and portfolio managers, to engage celebrities for brand-level promotion, subject to strict safeguards. In a consultation paper on the Common Advertisement Code (CAC) for specified regulated entities, SEBI has clarified that celebrity endorsements will be permitted only at the corporate or brand level and not for specific investment products or services. The move will be subject to prescribed conditions and mandatory risk disclaimers.

SEBI has proposed a single Common Advertisement Code to replace all existing entity-specific and exchange-specific advertisement guidelines, with the aim of harmonising norms, reducing compliance burden and strengthening investor protection.

The regulator has also suggested doing away with the requirement of prior approval for advertisements by stock brokers, Online Bond Platform Providers, investment advisers and research analysts. Instead, such advertisements would need to be reported to the concerned stock exchange or SEBI-recognised supervisory body within 24 hours of publication, considering the fast-paced digital advertising environment.

Further, SEBI has proposed permitting the use of ratings or rankings in advertisements, provided they are assigned by a Past Risk and Return Verification Agency. It has also suggested allowing abbreviated risk disclosures in SMS, push notifications and pop-ups, with links to detailed information.

Public comments on the proposals can be submitted till 14th July.