Under the Fifth Schedule of SEBI (Mutual Funds) Regulations, what is the mandatory requirement for the standard warning in audio-visual mutual fund advertisements?

[ A ]The standard warning containing 14 words must be clearly legible and audible, running for at least 5 seconds in visual and voice-over reiteration.[ CORRECT ]

[ B ]The warning must be spoken at ultra-high speed within 1 second without visual text.

[ C ]The standard warning is optional if the advertisement features a well-known financial celebrity.

[ D ]The AMC can modify or delete words from the 14-word standard warning at its own discretion.

Takeaway

Option A is correct: The standard warning containing 14 words must be clearly legible and audible, running for at least 5 seconds in visual and voice-over reiteration.

Derivation

The Fifth Schedule of SEBI (Mutual Funds) Regulations mandates that all advertisements must carry the standard warning: 'Mutual Fund investments are subject to market risks, read all scheme related documents carefully.' No addition or deletion of words is permitted. In audio-visual media, both the visual text and accompanying voice-over containing the 14 words must run for at least 5 seconds in a clear, audible, and understandable manner. This question tests compliance with advertisement codes. The typical trap is assuming AMCs can alter the warning wording or display it fleetingly.

Why the others fail

B — The warning must be spoken at ultra-high speed within 1 second without visual text.

Rushed or inaudible voice-overs violate SEBI's mandate requiring clear, understandable audio-visual warnings running at least 5 seconds.

C — The standard warning is optional if the advertisement features a well-known financial celebrity.

The standard warning is mandatory across all media, and celebrity endorsements of individual schemes are strictly prohibited.

D — The AMC can modify or delete words from the 14-word standard warning at its own discretion.

SEBI strictly prohibits any addition, deletion, or modification of the exact 14 words comprising the standard warning.