The Securities and Exchange Board of India (SEBI) has proposed that all regulated entities and their agents prominently display their registered name and registration number on the home page of their social media channels. The measure aims to clearly distinguish content from SEBI-regulated entities versus unregistered individuals, reducing the risk of misleading investors.

Key points from SEBI’s consultation paper:

• Disclosure Requirements: Regulated entities and their agents, including mutual fund and portfolio management service distributors, must display registration details on their social media home pages and alongside each uploaded video or post.
• Content Standards: Posts must avoid prohibited content, false or misleading statements, promises of guaranteed returns, and exaggeration of risk-return profiles. Past performance may not be referenced unless permitted by SEBI.
• Advertisement Compliance: Any content promoting a regulated entity or its products/services is treated as an advertisement and must comply with SEBI’s advertisement code.
• Restrictions on Associations: Regulated entities cannot associate with unregistered advisors online to prevent the spread of misleading information.
• Verification and Safeguards: SEBI has called for verified labels for legitimate trading apps and urged social media and internet platforms to implement safeguards against fraudulent investment content.

Background: Over the past 18 months, SEBI flagged over 100,000 instances of unlawful or misleading online content across platforms like Meta, Google, Telegram, and X. The new proposal seeks to strengthen investor protection and ensure transparency in online financial communications.