In a Press Release dated 23rd March, 2021 the Securities and Exchange Board of India (“SEBI”) has advised registered entities including MIIs (which use bulk SMS for providing their services to the investors) to ensure compliance with TRAI’s Telecom Commercial Communications Customer Preference Regulations, 2018 (“Regulations”).
Background:
TRAI had notified the Regulations in July, 2018 to curb the problem of unsolicited commercial communication. These regulations have a provision for Principal Entities (PE) (i.e. entities who intent to send bulk SMS) to register with the telecom service providers and are also required to register the template of the message. Effective implementation of these new regulations will help to protect investors and the general public from unsolicited and often misleading messages.
SEBI has noticed that unsolicited messages containing stock tips/ investment advice with respect to listed companies are increasingly being circulated through bulk SMS, inducing investors and the general public to invest in or purchase the stocks of certain listed companies.
The circulation of misleading messages is not only detrimental to the interest of the investors but also adversely affects the integrity of the securities market.
In light of this, the present Press Release has been issued.
Source: Securities and Exchange Board of India
