Q.42: We have received SEBI’s license for our Private Limited Company i.e. SHAH ROHIT FINANCIAL SERVICES PRIVATE LIMITED (SRFS). The existing LOEs are signed with clients in my individual certification i.e. ROHIT SHAH

To move the LOEs to the new entity, would it be okay to take a simple letter signed by client, stating below

I agree to continue receiving Financial Advisory Services from Shah Rohit Financial Services Private Limited as per the earlier engagement entered with ROHIT SHAH as per the same terms and conditions, without any break in the services.

Response : 

Legally, Private limited company is a separate legal entity in comparison to its members.

The original contract was between an Individual RIA and Xyz Client.

The new contract is expected between Non-Individual RIA and same client.

Based on change in type of registration with SEBI RIA license and also the entire change in SEBI RIA license, the new LOE should contain specific clauses connected to Non-Individual RIAs and not Individual RIAs. So, in any case, new clauses should be added, old clauses in relation to Individual RIA type should be removed, and many such nitty-gritties.

Therefore, contractually and also legally as per SEBI IA Regulations, old contracts would not stand the test of time and situation. So, new LOEs should be prepared and got signed from every client.