SEBI Proposes Common Advertisement Code For Regulated Entities, Invites Public Comments

The Securities and Exchange Board of India (SEBI) has issued a consultation paper proposing a Common Advertisement Code for specified SEBI-regulated entities. The objective is to create a uniform advertising framework across intermediaries and strengthen investor protection.

The proposed framework would apply to entities including stock brokers, depository participants, investment advisers, research analysts, mutual funds, portfolio managers and online bond platform providers. SEBI noted that advertisement guidelines for these entities are currently governed by multiple regulations and circulars.

The regulator observed that the growth of digital advertising has made a uniform framework necessary. According to SEBI, the existing regime remains fragmented, leads to approval-related delays and increases compliance costs, particularly for smaller entities.

Among the key proposals, SEBI has suggested replacing entity-specific advertisement codes with a single common code. It has also proposed shifting from mandatory prior approval of advertisements to a post-issuance reporting model. Under the proposed framework, advertisements may be reported within 24 hours of issuance. However, advertisements featuring celebrity endorsements would continue to require prior approval.

SEBI has also proposed permitting the use of celebrities for brand-level or entity-level promotions. However, endorsements of specific products or services would remain prohibited. The regulator stated that this approach would balance legitimate marketing objectives with investor protection.

Further, SEBI has proposed allowing the use of ratings and rankings in advertisements, subject to disclosures through recognised Past Risk and Return Verification Agencies (PaRRVA). It has also proposed abbreviated disclosures for short-format advertisements such as SMS messages, pop-ups and push notifications. Complete disclosures would need to be made available through hyperlinks.

The consultation paper also proposes excluding purely educational and investor awareness content from the scope of advertisements. This exclusion would apply only where the content does not carry promotional intent. In addition, SEBI has proposed an express prohibition on the use of dark patterns in advertisements.

Comments and suggestions on the consultation paper have been invited until July 14, 2026.