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CS Professional · IFSCA - Regulations, Listing and Compliances · International Financial Services Centres: An Introduction

Kabir Advisors, a GIFT IFSC unit, only gives advice to clients on buying securities and does not itself buy, sell or hold any asset. Is this activity a 'financial service' under the IFSCA Act, 2019?

Yes, it is a financial service. The Act lists rendering or agreeing to render advice on, or soliciting for, buying, selling or subscribing to a financial product as a financial service, and securities are financial products, so no separate notification or holding of assets is required.

  1. ANo, because only buying, selling or subscribing to a financial product is a financial service
  2. BNo, because advice is a financial service only when it is given to a non-resident
  3. CYes, because rendering advice on buying, selling or subscribing to a financial product is a financial serviceCorrect
  4. DYes, but only if the Central Government separately notifies advisory services

Explanation

The definition of financial service includes rendering or agreeing to render advice on, or soliciting for the purposes of, buying, selling or subscribing to a financial product. Securities are financial products. No separate notification is needed and no non-resident condition exists.

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