diff --git a/lib_com/ivas_prot.h b/lib_com/ivas_prot.h
index 27f15cb1e5c591a096f76cadc66b489a9ea6a776..012ba3fb2238b53dfe434d0a5069422e6906757c 100644
--- a/lib_com/ivas_prot.h
+++ b/lib_com/ivas_prot.h
@@ -999,10 +999,20 @@ ivas_error ivas_ism_metadata_enc_create(
 
 ivas_error ivas_ism_metadata_dec_create(
     Decoder_Struct *st_ivas,                                    /* i/o: IVAS decoder structure                      */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    const int16_t n_ISms,                                       /* i  : number of separately coded objects          */
+#else
     const int16_t n_ISms,                                       /* i  : number of objects                           */
+#endif
     int32_t element_brate_tmp[]                                 /* o  : element bitrate per object                  */
 );
 
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+void ivas_ism_reset_metadata_handle_dec(
+    ISM_METADATA_HANDLE hIsmMeta                                /* i/o: ISM metadata handle                         */
+);
+
+#endif
 ivas_error ivas_ism_enc(
     Encoder_Struct *st_ivas,                                    /* i/o: IVAS encoder structure                      */
     float *data[],                                             /* i  : input signal [channels][samples]            */
diff --git a/lib_com/options.h b/lib_com/options.h
index 1b094da1a0211d7bde8c80fa1b461749be3dfc6c..861cf052ec5c980a12516af0fe3648d169054add 100644
--- a/lib_com/options.h
+++ b/lib_com/options.h
@@ -196,6 +196,8 @@
 #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_984_OMASA_EXT_OUTPUT                  /* Nok: issue 1497 - porting OMASA EXT MR   */
+#define NONBE_FIX_1065_ISM_MD_HANDLE                    /* VA: issue 1065: Allocate only the necessary number of ISM MD decoder handles. */
+
 /* #################### End BASOP porting switches ############################ */
 
 /* clang-format on */
diff --git a/lib_dec/ivas_init_dec.c b/lib_dec/ivas_init_dec.c
index 32e851d4e10ec1e9a1c16de5c829b58ce0303ab0..0036ac35553798fc265fd967ae3b7e98ae63704b 100644
--- a/lib_dec/ivas_init_dec.c
+++ b/lib_dec/ivas_init_dec.c
@@ -1272,7 +1272,11 @@ ivas_error ivas_init_decoder(
             }
         }
 
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+        if ( ( error = ivas_ism_metadata_dec_create( st_ivas, st_ivas->nchan_ism, element_brate_tmp ) ) != IVAS_ERR_OK )
+#else
         if ( ( error = ivas_ism_metadata_dec_create( st_ivas, st_ivas->nSCE, element_brate_tmp ) ) != IVAS_ERR_OK )
+#endif
         {
             return error;
         }
@@ -1603,11 +1607,24 @@ ivas_error ivas_init_decoder(
             }
 
             reset_indices_dec( st_ivas->hSCE[0]->hCoreCoder[0] );
-
-            if ( ( error = ivas_ism_metadata_dec_create( st_ivas, 1, NULL ) ) != IVAS_ERR_OK )
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+            if ( hDecoderConfig->output_config == IVAS_AUDIO_CONFIG_EXTERNAL )
             {
-                return error;
+                if ( ( error = ivas_ism_metadata_dec_create( st_ivas, st_ivas->nchan_ism, NULL ) ) != IVAS_ERR_OK )
+                {
+                    return error;
+                }
             }
+            else
+            {
+#endif
+                if ( ( error = ivas_ism_metadata_dec_create( st_ivas, 1, NULL ) ) != IVAS_ERR_OK )
+                {
+                    return error;
+                }
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+            }
+#endif
         }
         else if ( st_ivas->ism_mode == ISM_MASA_MODE_DISC )
         {
diff --git a/lib_dec/ivas_ism_metadata_dec.c b/lib_dec/ivas_ism_metadata_dec.c
index fd2d630299e34c10274e72d11562718d9e609c89..6331b191d323183a70a3031cac6368af33ccc967 100644
--- a/lib_dec/ivas_ism_metadata_dec.c
+++ b/lib_dec/ivas_ism_metadata_dec.c
@@ -642,6 +642,40 @@ ivas_error ivas_ism_metadata_dec(
     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(
+    ISM_METADATA_HANDLE hIsmMeta /* i/o: ISM metadata handle     */
+)
+{
+    hIsmMeta->last_ism_metadata_flag = 0;
+    hIsmMeta->position_angle.last_angle1_idx = 0;
+    hIsmMeta->position_angle.last_angle2_idx = 1 << ( ISM_ELEVATION_NBITS - 1 );
+    hIsmMeta->orientation_angle.last_angle1_idx = 0;
+    hIsmMeta->orientation_angle.last_angle2_idx = 1 << ( ISM_ELEVATION_NBITS - 1 );
+    hIsmMeta->last_radius_idx = 8; /* Init to radius 1.0 */
+
+    hIsmMeta->last_true_azimuth = 0;
+    hIsmMeta->last_true_elevation = 0;
+    hIsmMeta->last_azimuth = 0;
+    hIsmMeta->last_elevation = 0;
+
+    hIsmMeta->ism_imp = -1;
+    hIsmMeta->ism_md_null_flag = 0;
+    hIsmMeta->ism_md_lowrate_flag = 0;
+
+    ivas_ism_reset_metadata( hIsmMeta );
+
+    return;
+}
+
+#endif
 
 /*-------------------------------------------------------------------------
  * ivas_ism_metadata_dec_create()
@@ -650,8 +684,12 @@ ivas_error ivas_ism_metadata_dec(
  *-------------------------------------------------------------------------*/
 
 ivas_error ivas_ism_metadata_dec_create(
-    Decoder_Struct *st_ivas,    /* i/o: IVAS decoder structure      */
-    const int16_t n_ISms,       /* i  : number of objects           */
+    Decoder_Struct *st_ivas, /* i/o: IVAS decoder structure      */
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+    const int16_t n_ISms, /* i  : number of separately coded objects  */
+#else
+    const int16_t n_ISms, /* i  : number of objects           */
+#endif
     int32_t element_brate_tmp[] /* o  : element bitrate per object  */
 )
 {
@@ -659,13 +697,27 @@ ivas_error ivas_ism_metadata_dec_create(
     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( st_ivas->hIsmMetaData[ch] );
+#else
         st_ivas->hIsmMetaData[ch]->last_ism_metadata_flag = 0;
         st_ivas->hIsmMetaData[ch]->position_angle.last_angle1_idx = 0;
         st_ivas->hIsmMetaData[ch]->position_angle.last_angle2_idx = 1 << ( ISM_ELEVATION_NBITS - 1 );
@@ -683,8 +735,21 @@ ivas_error ivas_ism_metadata_dec_create(
         st_ivas->hIsmMetaData[ch]->ism_md_lowrate_flag = 0;
 
         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 ( ( error = ivas_ism_config( 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.c b/lib_dec/ivas_omasa_dec.c
index 68fefcceac98a40c8bad4ac81342d384104143e4..103851f1f3f3d2ec0c9d03e1475d4fba60731bf1 100644
--- a/lib_dec/ivas_omasa_dec.c
+++ b/lib_dec/ivas_omasa_dec.c
@@ -297,6 +297,22 @@ ivas_error ivas_omasa_dec_config(
         if ( 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( 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( st_ivas->hIsmMetaData[k] );
+                }
+            }
+#else
             n_MD = st_ivas->nchan_ism;
             ivas_ism_metadata_close( st_ivas->hIsmMetaData, 0 );
             if ( ( error = ivas_ism_metadata_dec_create( st_ivas, st_ivas->nchan_ism, NULL ) ) != IVAS_ERR_OK )
@@ -305,6 +321,7 @@ ivas_error ivas_omasa_dec_config(
             }
 
             ivas_ism_metadata_close( st_ivas->hIsmMetaData, n_MD );
+#endif
         }
         else
         {
@@ -319,13 +336,21 @@ ivas_error ivas_omasa_dec_config(
                         return error;
                     }
                 }
+#ifdef NONBE_FIX_1065_ISM_MD_HANDLE
+                else
+                {
+                    ivas_ism_reset_metadata_handle_dec( st_ivas->hIsmMetaData[0] );
+                }
+#endif
             }
             else if ( st_ivas->ism_mode == ISM_MASA_MODE_DISC )
             {
                 n_MD = st_ivas->nchan_ism;
 
-                ivas_ism_metadata_close( st_ivas->hIsmMetaData, 0 );
+#ifndef NONBE_FIX_1065_ISM_MD_HANDLE
 
+                ivas_ism_metadata_close( st_ivas->hIsmMetaData, 0 );
+#endif
                 if ( ( error = ivas_ism_metadata_dec_create( st_ivas, st_ivas->nchan_ism, NULL ) ) != IVAS_ERR_OK )
                 {
                     return error;
@@ -361,6 +386,7 @@ ivas_error ivas_omasa_dec_config(
 
         ivas_ism_metadata_close( st_ivas->hIsmMetaData, n_MD );
 #endif
+
         st_ivas->hCPE[0]->element_brate = ivas_total_brate - ism_total_brate;
 
         /*-----------------------------------------------------------------*