The Securities Exchange Board of India (“SEBI”), in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, vide Circular No. SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2025/22[1], dated February 21, 2025, issued an Investor Charter for stock brokers (“Circular”). The provisions of this Circular shall come into effect immediately.
The Circular supersedes SEBI’s circular dated December 02, 2021, on ‘Investor Charter and disclosure Investor Complaints by Stock Brokers on their websites’. Further, this Circular amends Clause 75 of the Master Circular for Stock Brokers dated August 09, 2024.
The Key highlights of this Circular are as follows:
- Enhanced Consumer Protection: The Circular discusses the updated Investor Charter reflecting SEBI’s enhanced focus on safeguarding investors’ interests by incorporating provisions related to the ODR platform, which is designed to facilitate a more efficient grievance redressal mechanism. The updated Investor Charter for stock brokers has been provided in Annexure-A of the Circular.
- Dissemination of Investor Charter: SEBI has mandated that stock brokers disclose the updated Investor Charter to all clients, both existing and new. This includes making the Investor Charter available on the brokers’ websites, prominently displaying it in their offices, and providing a copy to clients as part of the account opening kit, through emails, or physical letters.
- Grievance Redressal Transparency: In a bid to enhance transparency, SEBI has directed stock brokers to disclose data related to investor complaints received against them or issues handled by them, along with the status of redressal. This information shall be required to be updated monthly on brokers’ websites, latest by the 7th of each succeeding month, as per the format prescribed in Annexure B of the Circular.
[1]https://www.sebi.gov.in/legal/circulars/feb-2025/investor-charter-for-stock-brokers_92099.html