SEBI Ends Mandatory Call Recording for Research Analysts' Institutional Clients From 8 November
SEBI has dropped the mandatory call-recording requirement for research analysts (RAs) and research entities when they speak to institutional investor clients. The change comes through circular HO/38/11/(9)2026-MIRSD-POD/I/24272/2026 dated 23 October 2026, which rewrites two paragraphs of the Master Circular for Research Analysts dated 6 February 2026, and it applies from 8 November 2026. Calls with retail clients must still be recorded, and every RA must continue to keep records of interactions with all clients, institutional ones included.
The circular is addressed to all registered RAs and to the Research Analysts Administration and Supervisory Body (RAASB), the body that supervises RAs on SEBI's behalf. It is issued under Section 11(1) of the SEBI Act, 1992 read with Regulation 25(1)(vii) of the SEBI (Research Analysts) Regulations, 2014.
Regulation 25(1)(vii) amendment that sits behind the circular
The legal change was made first in the regulations. The SEBI (Research Analysts) (Amendment) Regulations, 2026, notified on 8 October 2026 (F. No. SEBI/LAD-NRO/GN/2026/321) and published in the Gazette on 9 October 2026, do three things. They insert a new clause (ia) in Regulation 2(1) defining "institutional investor" by reference to Regulation 2(1)(y) of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. They delete the word "etc." from Regulation 25(1)(vii), so the clause now speaks of emails and call recordings of conversations with clients. And they add a proviso stating that maintaining call recordings of conversations with clients who are institutional investors is not mandatory.
Those amendment regulations come into force on the thirtieth day from Gazette publication, which lands on 8 November 2026. The circular adopts the same date, so the regulation and the Master Circular change together and there is no gap in which the two say different things.
The proposal itself was put out for comment in SEBI's consultation paper of 18 May 2026 on relaxing call records for institutional clients, with comments due by 8 June 2026. The paper recorded representations from market participants, including the Industry Standard Forum for Research Analysts, that recording calls with institutional investors was not proportionate to the risk. SEBI's reasoning was that institutional investors can assess research independently, carry out their own due diligence and know their redress options better than retail investors, while the RA business does not involve client-specific advice, asset management or execution of trades.
What paragraph 1.13 and paragraph 33 of the RA Master Circular now say
Paragraph 1.13 of Chapter I of the Master Circular has been replaced. RAs must maintain records of interactions with all clients, including prospective clients. Acceptable forms are a physical record signed by the client, call recordings, correspondence through the client's registered email, SMS records, or any other legally verifiable record. A new proviso says call recordings with institutional investors are not mandatory. The record must start from the first interaction with the client and continue until research services to that client end.
Retention stays at five years. Where a dispute has been raised, records must be kept until it is resolved, and where SEBI asks for specific records to be preserved, they must be kept until SEBI says otherwise.
The answer to point (iii) of paragraph 33 in Annexure I of Chapter VII, which is part of the frequently asked questions, has also been replaced. Record maintenance applies to fee-paying clients and to non-fee-paying clients who receive research as a value-added service along with other paid services. Call recording is not required where the interaction takes place through a channel that leaves a digital footprint, such as email. The circular states that the purpose of these records is to document interactions so that client grievances about research services can be dealt with. The old line in that FAQ, which said RAs had to comply even for institutional investors and qualified institutional buyers, is what the proviso now displaces.
Which interactions still need a call recording from 8 November 2026
The practical effect depends on who the client is and how the conversation happened. The position under the revised paragraphs works out as follows.
| Client and channel | Call recording | Other interaction record |
|---|---|---|
| Retail client, phone or video call | Mandatory | Required, retained for five years |
| Institutional investor client, phone or video call | Not mandatory | Required in a legally verifiable form, retained for five years |
| Any client, interaction by registered email | Not required, email leaves a digital footprint | The email trail itself, retained for five years |
| Prospective client, first interaction onwards | As for the client category the prospect falls in | Required from the first interaction |
| Non-fee-paying client getting research as a value-added service | As for the client category | Required |
The relaxation therefore turns on a classification question. A client counts as an institutional investor only if it falls within Regulation 2(1)(y) of the ICDR Regulations, 2018, which the RA Regulations now borrow. An RA that serves a mixed book should tag each client at onboarding against that definition and keep the basis for the tag on file. A client that does not fit the definition remains under the full requirement, whatever its size or apparent sophistication.
The relief also covers only the recording. A research entity that stops recording institutional calls still has to show, if a grievance arises, what was discussed and when. Firms that move institutional conversations off recorded lines would do well to switch to a written equivalent: a call note confirmed by the client over registered email, or a signed meeting record. Either fits the list of legally verifiable records in the revised paragraph 1.13.
Record-keeping failures SEBI is still penalising
The relaxation is narrow, and SEBI's enforcement on RA records continues. In an adjudication order dated 22 October 2026 against research analyst Rishabh Tanwar, SEBI imposed a penalty of ₹6,00,000 under Section 15EB of the SEBI Act after finding, among six admitted violations, that KYC records of 471 out of 509 clients had been lost when data was deleted, with no backup or disaster recovery plan in place. The same order dealt with outsourcing of KYC and grievance handling to a third party without due diligence. Call recording was not in issue there, but the order shows that the five-year retention duty is only as good as the storage and backup arrangements behind it.
RAASB bye-laws and the 8 November 2026 start
The circular directs RAASB to amend its bye-laws and rules to give effect to the change, to bring the provisions to the notice of all registered RAs and to put them on its website. All other provisions of the Master Circular remain unchanged.
Until 8 November 2026, the existing requirement applies in full, so calls with institutional investors made before that date still need to be recorded and retained for five years. From that date, RAs and research entities should update their written policies on client interaction records, revise the client classification fields in onboarding, and check that the RAASB rule changes match their internal procedures before they switch off recording on institutional lines.
Official source: View the official source document
