diff --git a/lib_com/ivas_prot_fx.h b/lib_com/ivas_prot_fx.h
index 34928d7abf511d0555bb0052e2908bdccdf8f586..8a66cc117cd2d374e5a84dd240763e06f60c93bd 100644
--- a/lib_com/ivas_prot_fx.h
+++ b/lib_com/ivas_prot_fx.h
@@ -2375,10 +2375,21 @@ ivas_error ivas_ism_dec_config_fx(
 );
 
 ivas_error ivas_ism_metadata_dec_create_fx(
-    Decoder_Struct *st_ivas,   /* i/o: IVAS decoder structure      */
+    Decoder_Struct *st_ivas,    /* i/o: IVAS decoder structure                      */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    const Word16 n_ISms,        /* i  : number of separately coded objects          */
+#else
     const Word16 n_ISms,       /* i  : number of objects           */
-    Word32 element_brate_tmp[] /* o  : element bitrate per object  */
+#endif
+    Word32 element_brate_tmp[] /* o  : element bitrate per object                   */
+);
+
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+void ivas_ism_reset_metadata_handle_dec_fx(
+    ISM_METADATA_HANDLE hIsmMeta /* i/o: ISM metadata handle                         */
 );
+
+#endif
 ivas_error ivas_sba_dec_reconfigure_fx(
     Decoder_Struct *st_ivas,  /* i/o: IVAS decoder structure              */
     UWord16 *nSamplesFlushed, /* o  : number of samples flushed           */
@@ -2394,6 +2405,7 @@ void ivas_spar_md_dec_matrix_close_fx(
     ivas_spar_md_dec_state_t *hMdDecoder, /* i/o: SPAR MD decoder handle      */
     const Word16 num_channels             /* i  : number of internal channels */
 );
+
 ivas_error ivas_spar_dec_open_fx(
     Decoder_Struct *st_ivas,        /* i/o: IVAS decoder handle        */
     const Word16 spar_reconfig_flag /* i  : SPAR reconfiguration flag  */
diff --git a/lib_com/options.h b/lib_com/options.h
index dacfa6096041dce379ab23462aaa4d730d2b77ed..201446dd400413e2b9a5c990669f8f7853812fed 100755
--- a/lib_com/options.h
+++ b/lib_com/options.h
@@ -114,6 +114,8 @@
 #define NONBE_FIX_SBA_SIGNALING_BITS_B                  /* FhG: issue 1061: option B: signal sba order additionally in OSBA */
 #define NONBE_FIX_1045_ISM_BITRATE_SWITCHING            /* Eri: Difference between ROM/File HRTF in ISM bitrate switching */
 
+#define NONBE_FIX_1065_ISM_MD_HANDLE                    /* VA: issue 1065: Allocate only the necessary number of ISM MD decoder handles. */
+
 /* #################### End BASOP porting switches ############################ */
 
 #endif
diff --git a/lib_dec/ivas_init_dec_fx.c b/lib_dec/ivas_init_dec_fx.c
index e119b37c4dea95acc6ca2da02297abff2e7a1197..218501a39edd0939ccb3f7ba478a92a9a8e6045e 100644
--- a/lib_dec/ivas_init_dec_fx.c
+++ b/lib_dec/ivas_init_dec_fx.c
@@ -1508,7 +1508,11 @@ ivas_error ivas_init_decoder_fx(
             }
         }
 
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+        IF( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, st_ivas->nchan_ism, element_brate_tmp ) ) != IVAS_ERR_OK )
+#else
         IF( NE_32( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, st_ivas->nSCE, element_brate_tmp ) ), IVAS_ERR_OK ) )
+#endif
         {
             return error;
         }
@@ -1907,6 +1911,7 @@ ivas_error ivas_init_decoder_fx(
             move16();
             ism_total_brate = sep_object_brate[k - 2][0];
             move32();
+
             IF( NE_32( ( error = create_sce_dec( st_ivas, 0, ism_total_brate ) ), IVAS_ERR_OK ) )
             {
                 return error;
@@ -1914,10 +1919,24 @@ ivas_error ivas_init_decoder_fx(
 
             reset_indices_dec( st_ivas->hSCE[0]->hCoreCoder[0] );
 
-            IF( NE_32( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, 1, NULL ) ), IVAS_ERR_OK ) )
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+            IF( EQ_32( output_config, IVAS_AUDIO_CONFIG_EXTERNAL ) )
             {
-                return error;
+                if ( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, st_ivas->nchan_ism, NULL ) ) != IVAS_ERR_OK )
+                {
+                    return error;
+                }
             }
+            else
+            {
+#endif
+                IF( NE_32( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, 1, NULL ) ), IVAS_ERR_OK ) )
+                {
+                    return error;
+                }
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+            }
+#endif
         }
         ELSE IF( EQ_32( st_ivas->ism_mode, ISM_MASA_MODE_DISC ) )
         {
diff --git a/lib_dec/ivas_ism_metadata_dec_fx.c b/lib_dec/ivas_ism_metadata_dec_fx.c
index 3288903ab8f43b3b9cb00c03a44abb6b904cfbcc..fcc22054a5f9cbfc62857fc5e6af1205e1f40503 100644
--- a/lib_dec/ivas_ism_metadata_dec_fx.c
+++ b/lib_dec/ivas_ism_metadata_dec_fx.c
@@ -780,6 +780,53 @@ ivas_error ivas_ism_metadata_dec_fx(
     return IVAS_ERR_OK;
 }
 
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+
+/*-------------------------------------------------------------------*
+ * ivas_ism_reset_metadata_handle_dec()
+ *
+ * Reset ISM decoder metadata handle
+ *-------------------------------------------------------------------*/
+
+void ivas_ism_reset_metadata_handle_dec_fx(
+    ISM_METADATA_HANDLE hIsmMeta /* i/o: ISM metadata handle     */
+)
+{
+    hIsmMeta->last_ism_metadata_flag = 0;
+    move16();
+    hIsmMeta->position_angle.last_angle1_idx = 0;
+    move16();
+    hIsmMeta->position_angle.last_angle2_idx = 1 << ( ISM_ELEVATION_NBITS - 1 );
+    move16();
+    hIsmMeta->orientation_angle.last_angle1_idx = 0;
+    move16();
+    hIsmMeta->orientation_angle.last_angle2_idx = 1 << ( ISM_ELEVATION_NBITS - 1 );
+    move16();
+    hIsmMeta->last_radius_idx = 8; /* Init to radius 1.0 */
+    move16();
+
+    hIsmMeta->last_true_azimuth_fx = 0;
+    move32();
+    hIsmMeta->last_true_elevation_fx = 0;
+    move32();
+    hIsmMeta->last_azimuth_fx = 0;
+    move32();
+    hIsmMeta->last_elevation_fx = 0;
+    move32();
+
+    hIsmMeta->ism_imp = -1;
+    move16();
+    hIsmMeta->ism_md_null_flag = 0;
+    move16();
+    hIsmMeta->ism_md_lowrate_flag = 0;
+    move16();
+
+    ivas_ism_reset_metadata( hIsmMeta );
+
+    return;
+}
+
+#endif
 
 /*-------------------------------------------------------------------------
  * ivas_ism_metadata_dec_create()
@@ -788,22 +835,40 @@ ivas_error ivas_ism_metadata_dec_fx(
  *-------------------------------------------------------------------------*/
 
 ivas_error ivas_ism_metadata_dec_create_fx(
-    Decoder_Struct *st_ivas,   /* i/o: IVAS decoder structure      */
-    const Word16 n_ISms,       /* i  : number of objects           */
-    Word32 element_brate_tmp[] /* o  : element bitrate per object  */
+    Decoder_Struct *st_ivas, /* i/o: IVAS decoder structure               */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    const Word16 n_ISms, /* i  : number of separately coded objects   */
+#else
+    const Word16 n_ISms, /* i  : number of objects           */
+#endif
+    Word32 element_brate_tmp[] /* o  : element bitrate per object           */
 )
 {
     Word16 ch;
     ivas_error error;
 
     /* allocate ISM metadata handles */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    FOR( ch = 0; ch < n_ISms; ch++ )
+#else
     FOR( ch = 0; ch < MAX_NUM_OBJECTS; ch++ )
+#endif
     {
-        IF( ( st_ivas->hIsmMetaData[ch] = (ISM_METADATA_HANDLE) malloc( sizeof( ISM_METADATA_FRAME ) ) ) == NULL )
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+        IF( st_ivas->hIsmMetaData[ch] == NULL ) /* note: the handle can be allocated in OMASA bitrate switching from ISM_MASA_MODE_xxx_ONE_OBJ to ISM_MASA_MODE_DISC mode for 'ch==0' */
         {
-            return ( IVAS_ERROR( IVAS_ERR_FAILED_ALLOC, "Can not allocate memory for ISM MetaData\n" ) );
+#endif
+            IF( ( st_ivas->hIsmMetaData[ch] = (ISM_METADATA_HANDLE) malloc( sizeof( ISM_METADATA_FRAME ) ) ) == NULL )
+            {
+                return ( IVAS_ERROR( IVAS_ERR_FAILED_ALLOC, "Can not allocate memory for ISM MetaData\n" ) );
+            }
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
         }
+#endif
 
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+        ivas_ism_reset_metadata_handle_dec_fx( st_ivas->hIsmMetaData[ch] );
+#else
         st_ivas->hIsmMetaData[ch]->last_ism_metadata_flag = 0;
         move16();
         st_ivas->hIsmMetaData[ch]->position_angle.last_angle1_idx = 0;
@@ -834,8 +899,21 @@ ivas_error ivas_ism_metadata_dec_create_fx(
         move16();
 
         ivas_ism_reset_metadata( st_ivas->hIsmMetaData[ch] );
+#endif
+    }
+
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    /* sanity freeing - it can happen only in reconfiguration when a smaller number of handles than before is requested */
+    FOR( ; ch < MAX_NUM_OBJECTS; ch++ )
+    {
+        IF( st_ivas->hIsmMetaData[ch] != NULL )
+        {
+            free( st_ivas->hIsmMetaData[ch] );
+            st_ivas->hIsmMetaData[ch] = NULL;
+        }
     }
 
+#endif
     IF( element_brate_tmp != NULL )
     {
         IF( NE_32( ( error = ivas_ism_config_fx( st_ivas->hDecoderConfig->ivas_total_brate, n_ISms, n_ISms, NULL, 0, NULL, NULL, element_brate_tmp, NULL, NULL, 0 ) ), IVAS_ERR_OK ) )
diff --git a/lib_dec/ivas_omasa_dec_fx.c b/lib_dec/ivas_omasa_dec_fx.c
index c01fda7d76ef06d8d4595578bf9de82a893135e5..7ed8aac108f715e7747c0dbb5463a3fcf3adc308 100644
--- a/lib_dec/ivas_omasa_dec_fx.c
+++ b/lib_dec/ivas_omasa_dec_fx.c
@@ -569,6 +569,22 @@ ivas_error ivas_omasa_dec_config_fx(
         IF( EQ_32( st_ivas->hDecoderConfig->output_config, IVAS_AUDIO_CONFIG_EXTERNAL ) )
         {
             /* the full number of hIsmMetaData are needed for EXT output */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+            IF( st_ivas->hIsmMetaData[0] == NULL )
+            {
+                IF( ( error = ivas_ism_metadata_dec_create_fx( st_ivas, st_ivas->nchan_ism, NULL ) ) != IVAS_ERR_OK )
+                {
+                    return error;
+                }
+            }
+            ELSE
+            {
+                FOR( k = 0; k < st_ivas->nchan_ism; k++ )
+                {
+                    ivas_ism_reset_metadata_handle_dec_fx( st_ivas->hIsmMetaData[k] );
+                }
+            }
+#else
             move16();
             n_MD = st_ivas->nchan_ism;
             ivas_ism_metadata_close( st_ivas->hIsmMetaData, 0 );
@@ -581,6 +597,7 @@ ivas_error ivas_omasa_dec_config_fx(
             }
 
             ivas_ism_metadata_close( st_ivas->hIsmMetaData, n_MD );
+#endif
         }
         ELSE
         {
@@ -599,14 +616,21 @@ ivas_error ivas_omasa_dec_config_fx(
                         return error;
                     }
                 }
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+                ELSE
+                {
+                    ivas_ism_reset_metadata_handle_dec_fx( st_ivas->hIsmMetaData[0] );
+                }
+#endif
             }
             ELSE IF( EQ_32( st_ivas->ism_mode, ISM_MASA_MODE_DISC ) )
             {
                 n_MD = st_ivas->nchan_ism;
                 move16();
 
+#ifndef NONBE_FIX_1065_ISM_MD_HANDLE
                 ivas_ism_metadata_close( st_ivas->hIsmMetaData, 0 );
-
+#endif
                 error = ivas_ism_metadata_dec_create_fx( st_ivas, st_ivas->nchan_ism, NULL );
                 move32();
                 IF( NE_32( error, IVAS_ERR_OK ) )
@@ -647,6 +671,7 @@ ivas_error ivas_omasa_dec_config_fx(
 
         ivas_ism_metadata_close( st_ivas->hIsmMetaData, n_MD );
 #endif
+
         st_ivas->hCPE[0]->element_brate = L_sub( ivas_total_brate, ism_total_brate );
 
         /*-----------------------------------------------------------------*