The Securities and Exchange Board of India (SEBI) has proposed a Common Advertisement Code (CAC) for regulated entities, seeking to replace multiple advertising frameworks with a single, standardised set of rules across the securities market.
In a consultation paper released on Tuesday, the market regulator said the proposed framework is aimed at simplifying compliance requirements, reducing regulatory overlap, and strengthening investor protection.
The Common Advertisement Code would apply to a wide range of SEBI-regulated entities, including stock brokers, depository participants, investment advisers, research analysts, online bond platform providers, portfolio managers, mutual funds, and asset management companies (AMCs).
According to SEBI, the new code is proposed to be incorporated into the SEBI (Intermediaries) Regulations, 2008, creating a unified regulatory framework for advertisements across different categories of market participants.
One of the most significant changes proposed is the replacement of the existing prior approval system for advertisements.
Instead of obtaining approval before publishing promotional material, regulated entities would be required to report advertisements within 24 hours of issuance under a post-publication reporting mechanism.
The regulator believes this approach could reduce administrative delays while maintaining oversight.
SEBI has also proposed allowing regulated entities to use celebrities in brand-level and entity-level promotional campaigns, subject to prescribed safeguards and approval requirements.
The proposal marks a shift from the stricter advertising restrictions that have applied to certain categories of financial market participants in recent years.
According to the consultation paper, the Common Advertisement Code would replace existing entity-specific and exchange-specific advertising regulations, helping reduce compliance complexity and creating a more harmonised framework across the industry.
Another key proposal relates to the use of ratings and rankings in advertisements.
SEBI has suggested permitting regulated entities to advertise ratings and rankings assigned by Past Risk and Return Verification Agencies (PaRRVA), subject to specified safeguards and disclosure requirements.
The regulator said this could improve transparency and allow entities to communicate legitimate performance distinctions to investors.
To reduce ambiguity around what constitutes an advertisement, SEBI has also proposed revising the definition of the term.
The revised definition would clearly distinguish promotional communications from routine investor-service communications and factual disclosures.
The consultation paper includes an illustrative list of communications that would not be classified as advertisements under the proposed framework.
In addition, SEBI has proposed the development of digital reporting platforms by supervisory bodies to streamline compliance and monitoring.
For entities regulated by multiple supervisory bodies, the regulator has suggested creating a common reporting platform to improve operational efficiency and strengthen oversight.
The proposed reforms are part of SEBI’s broader effort to modernise regulatory processes while maintaining safeguards for investors and ensuring responsible communication by market participants.
SEBI has invited comments from stakeholders and the public on the consultation paper until July 14, 2026.
