The wall SEBI builds between an individual Investment Adviser and distribution
Four separate rules keep an individual adviser from also selling the products they recommend. None of them are about scale. They apply from client one.
Want this checked against your own position? We handle the documentation and the filing.
The 300-client line and the corporate segregation rules that follow it get the attention, because they arrive with a deadline attached. The rules that apply to an individual Investment Adviser from day one get less notice, and they are the ones that decide whether you can also sell what you recommend.
Advice starts with a signed risk profile
An adviser completes a risk profile for the client and gets the client's consent to it before giving any advice. That signed profile is what the advice has to trace back to, in a dispute or in the audit.
KYC runs through a KRA
Client KYC is done through a KYC Registration Agency. An adviser does not run a separate KYC process outside that system.
The adviser cannot also be the distributor
An individual Investment Adviser, or a member of their family, cannot provide distribution services to a client they are advising. This is the individual-level version of a rule that gets stricter once a practice corporatises. A non-individual adviser that also distributes has to run advisory through a separately identifiable department, keep the two arm's length, and maintain client-level segregation at group level, so the same client cannot sit on both sides of the business anywhere in the group. That corporate version is where most advisers meet this rule for the first time at scale.
Implementation, if you offer it, has a narrow lane
Where an adviser helps a client act on the advice, implementation services can only run through direct schemes, and no consideration for that implementation may be taken at the level of the client's group or family. The moment consideration changes hands for execution beyond that, advice has crossed into distribution.
What this rules out in practice
Put together, these four rules mean an individual adviser earns from advice fees or from distribution, never both from the same client under one roof. It is also why trading calls sit outside investment advice entirely under the IA Regulations. SEBI treats intraday, ultra-short and non-personalised recommendations as a separate activity, kept apart from advice rather than folded into a lighter version of it.
Sources read on 11 August 2026. SEBI revises these requirements, so we re-confirm every figure against the current circular before it goes into an application.
Read next
Investment Adviser
buildwright.co.in
The 300-client line: when an individual adviser has to become a company
Cross 300 client agreements on any single day, or ₹3 crore of fees in a financial year, and the registration you hold stops being the right one.
5 min read
IA and RA
buildwright.co.in
What a registered adviser or analyst can charge a client
There is a hard rupee ceiling per family per year, an alternative percentage mode, and rules about how far ahead you may bill. All of it applies only to individual and HUF clients.
7 min read
IA and RA
buildwright.co.in
Investment Adviser or Research Analyst: which one covers what you actually do
The line is not seniority or scale. It is whether you are advising a specific client on their situation, or publishing a recommendation to whoever reads it.
8 min read