In a significant step toward enhancing transparency and easing compliance requirements, the Securities and Exchange Board of India (SEBI) has issued a new circular — HO/38/12/11(1)2025-MIRSD-POD/I/73/2025, dated October 30, 2025. The circular provides an interim arrangement for Investment Advisers (IAs) and Research Analysts (RAs) to communicate certified past performance data to clients before the operationalisation of the Past Risk and Return Verification Agency (PaRRVA).
Background: Establishing PaRRVA
SEBI’s earlier circular, issued on April 4, 2025, outlined the creation and framework of PaRRVA — a dedicated agency designed to verify and authenticate risk and return data of Investment Advisers and Research Analysts. The establishment of PaRRVA was in response to long-standing industry demands for a standardized and credible system to showcase the performance history of registered professionals.
Once operational, PaRRVA will verify performance metrics prospectively — that is, for periods after an IA or RA is onboarded with the agency. However, questions remained regarding how advisers and analysts could present performance data for periods before PaRRVA’s operationalisation.
Industry Concerns and SEBI’s Response
In response to representations from various industry associations, SEBI recognized the need for a practical interim solution. Many IAs and RAs expressed concern that, without a verified channel, they would be unable to present their historical performance records to clients, potentially impacting their credibility and client acquisition.
Addressing these concerns, SEBI’s latest circular provides a temporary framework allowing advisers and analysts to present certified past performance data, subject to strict conditions that balance transparency with investor protection.
Key Provisions of the Interim Framework
The interim arrangement announced by SEBI outlines the following key points:
- Certification by Chartered Professionals:
IAs and RAs may share past performance data certified by a member of the ICAI (Institute of Chartered Accountants of India) or ICMAI (Institute of Cost Accountants of India). This ensures an additional layer of authenticity and accountability. - Client-Specific Disclosure:
Such certified data can be shared only upon the specific request of a client or prospective client. Importantly, it must be communicated on a one-to-one basis and cannot be made public through websites, advertisements, or any other media channels. - Mandatory Enrolment with PaRRVA:
IAs and RAs who wish to continue communicating certified performance data must enrol with PaRRVA within three months of its operationalisation. Failure to do so will bar them from sharing certified performance information after that period. - Applicable Period and Verification:
The interim arrangement applies only to performance data prior to PaRRVA’s operationalisation. Any performance communicated thereafter must be verified by PaRRVA using its standardized risk and return metrics. - Mandatory Disclaimer:
Every communication of past performance data must include a clear disclaimer stating that the data has not been verified by PaRRVA or SEBI and may not be comparable with data from other advisers or analysts. It must also remind clients that past performance is not indicative of future results and that SEBI registration does not guarantee returns.
Conclusion
SEBI’s interim arrangement represents a thoughtful balance between ease of doing business and investor protection. By allowing advisers and analysts to share their historical performance in a certified but controlled manner, SEBI has addressed a practical industry concern while maintaining regulatory integrity.
The move not only enhances transparency but also ensures that the transition to the upcoming PaRRVA framework is smooth and orderly — paving the way for a more reliable, verified, and investor-friendly advisory ecosystem in India.