Securities and Exchange Board of India
Encyclopedia
The Securities and Exchange Board of India (frequently abbreviated SEBI) is the regulator for the securities market in India.
in 1992 with SEBI Act 1992
being passed by the Indian Parliament. SEBI is headquartered in the business district of Bandra-Kurla complex
in Mumbai
, and has Northern, Eastern, Southern and Western regional offices in New Delhi
, Kolkata
, Chennai
and Ahmedabad
.
Controller of Capital Issues was the regulatory authority before SEBI came into existence; it derived authority from the Capital Issues (Control) Act, 1947.
Initially SEBI was a non statutory body without any statutory power. However in 1995, the SEBI was given additional statutory power by the Government of India through an amendment to the securities and Exchange Board of India Act 1992. In April, 1998 the SEBI was constituted as the regulator of capital market in India under a resolution of the Government of India.
The Board comprises
List of former Chairmen:
SEBI has three functions rolled into one body: quasi-legislative
, quasi-judicial and quasi-executive. It drafts regulations in its legislative capacity, it conducts investigation and enforcement action in its executive function and it passes rulings and orders in its judicial capacity. Though this makes it very powerful, there is an appeals process to create accountability. There is a Securities Appellate Tribunal which is a three-member tribunal and is presently headed by a former Chief Justice of a High court - Mr. Justice NK Sodhi. A second appeal lies directly to the Supreme Court
.
SEBI has enjoyed success as a regulator by pushing systemic reforms aggressively and successively (e.g. the quick movement towards making the markets electronic and paperless rolling settlement on T+2 basis). SEBI has been active in setting up the regulations as required under law.
SEBI has also been instrumental in taking quick and effective steps in light of the global meltdown and the Satyam fiasco. It had increased the extent and quantity of disclosures to be made by Indian corporate promoters. More recently, in light of the global meltdown,it liberalised the takeover code to facilitate investments by removing regulatory structures. In one such move, SEBI has increased the application limit for retail investors to Rs 2 lakh, from Rs 1 lakh at present.
History
It was formed officially by the Government of IndiaGovernment of India
The Government of India, officially known as the Union Government, and also known as the Central Government, was established by the Constitution of India, and is the governing authority of the union of 28 states and seven union territories, collectively called the Republic of India...
in 1992 with SEBI Act 1992
SEBI Act 1992
The Securities and Exchange Board of India Act, 1992 was amended in the years 1995, 1999 and 2002 to meet the requirements of changing needs of the securities market and responding to the development in the securities market....
being passed by the Indian Parliament. SEBI is headquartered in the business district of Bandra-Kurla complex
Bandra-Kurla complex
The Bandra Kurla Complex is a planned commercial complex in the suburbs of the Indian city of Mumbai . According to MMRDA, the complex is the first of a series of "growth centres" created to "arrest further concentration" of offices and commercial activities in South Mumbai...
in Mumbai
Mumbai
Mumbai , formerly known as Bombay in English, is the capital of the Indian state of Maharashtra. It is the most populous city in India, and the fourth most populous city in the world, with a total metropolitan area population of approximately 20.5 million...
, and has Northern, Eastern, Southern and Western regional offices in New Delhi
New Delhi
New Delhi is the capital city of India. It serves as the centre of the Government of India and the Government of the National Capital Territory of Delhi. New Delhi is situated within the metropolis of Delhi. It is one of the nine districts of Delhi Union Territory. The total area of the city is...
, Kolkata
Kolkata
Kolkata , formerly known as Calcutta, is the capital of the Indian state of West Bengal. Located on the east bank of the Hooghly River, it was the commercial capital of East India...
, Chennai
Chennai
Chennai , formerly known as Madras or Madarasapatinam , is the capital city of the Indian state of Tamil Nadu, located on the Coromandel Coast off the Bay of Bengal. Chennai is the fourth most populous metropolitan area and the sixth most populous city in India...
and Ahmedabad
Ahmedabad
Ahmedabad also known as Karnavati is the largest city in Gujarat, India. It is the former capital of Gujarat and is also the judicial capital of Gujarat as the Gujarat High Court has its seat in Ahmedabad...
.
Controller of Capital Issues was the regulatory authority before SEBI came into existence; it derived authority from the Capital Issues (Control) Act, 1947.
Initially SEBI was a non statutory body without any statutory power. However in 1995, the SEBI was given additional statutory power by the Government of India through an amendment to the securities and Exchange Board of India Act 1992. In April, 1998 the SEBI was constituted as the regulator of capital market in India under a resolution of the Government of India.
Organization structure
Upendra Kumar Sinha was appointed chairman on 18 February 2011 replacing C. B. Bhave.The Board comprises
| Name | Designation |
|---|---|
| Upendra Kumar Sinha | Chairman |
| Prashant Saran | Whole Time Member |
| CA. T.V. Mohandas Pai T.V. Mohandas Pai CA. T.V. Mohandas Pai is an Indian chartered accountant. He was a Member of the Board of Directors of Infosys, and Head – Administration, Education and Research, Finacle, Human Resources, and Infosys Leadership Institute.... |
Director, Infosys Infosys Infosys Limited, formerly Infosys Technologies Limited is a global technology services company headquartered in Bangalore, India. It is the second largest IT exporter in India with 133,560 employees as of March 2011. It has offices in 33 countries and development centers in India, China,... |
| Dr. Thomas Mathew | Joint Secretary, Ministry of Finance |
| V. K. Jairath | Member Appointed |
| Anand Sinha | Deputy Governor, Reserve Bank of India Reserve Bank of India The Reserve Bank of India is the central banking institution of India and controls the monetary policy of the rupee as well as US$300.21 billion of currency reserves. The institution was established on 1 April 1935 during the British Raj in accordance with the provisions of the Reserve Bank of... |
List of former Chairmen:
| Name | From | To |
|---|---|---|
| C. B. Bhave | 18 February 2008 | 18 February 2011 |
| M. Damodaran M. Damodaran Meleveetil Damodaran is currently an independent management consultant from India and a board member of Mahindra Satyam. Earlier he was the chairman of the Securities and Exchange Board of India , India's financial markets regulator and before that he headed the IDBI Bank... |
18 February 2005 | 18 February 2008 |
| G. N. Bajpai | 20 February 2002 | 18 February 2005 |
| D. R. Mehta | 21 February 1995 | 20 February 2002 |
| S. S. Nadkarni | 17 January 1994 | 31 January 1995 |
| G. V. Ramakrishna | 24 August 1990 | 17 January 1994 |
| Dr. S. A. Dave | 12 April 1988 | 23 August 1990 |
Functions and responsibilities
SEBI has to be responsive to the needs of three groups, which constitute the market:- the issuers of securities
- the investors
- the market intermediaries.
SEBI has three functions rolled into one body: quasi-legislative
Quasi-legislative
A quasi-legislative capacity is that in which a public administrative agency or body acts when it makes rules and regulations. When an administrative agency exercises its rule-making authority, it is said to act in a quasi-legislative manner. Administrative agencies acquire this authority to make...
, quasi-judicial and quasi-executive. It drafts regulations in its legislative capacity, it conducts investigation and enforcement action in its executive function and it passes rulings and orders in its judicial capacity. Though this makes it very powerful, there is an appeals process to create accountability. There is a Securities Appellate Tribunal which is a three-member tribunal and is presently headed by a former Chief Justice of a High court - Mr. Justice NK Sodhi. A second appeal lies directly to the Supreme Court
Supreme Court of India
The Supreme Court of India is the highest judicial forum and final court of appeal as established by Part V, Chapter IV of the Constitution of India...
.
SEBI has enjoyed success as a regulator by pushing systemic reforms aggressively and successively (e.g. the quick movement towards making the markets electronic and paperless rolling settlement on T+2 basis). SEBI has been active in setting up the regulations as required under law.
SEBI has also been instrumental in taking quick and effective steps in light of the global meltdown and the Satyam fiasco. It had increased the extent and quantity of disclosures to be made by Indian corporate promoters. More recently, in light of the global meltdown,it liberalised the takeover code to facilitate investments by removing regulatory structures. In one such move, SEBI has increased the application limit for retail investors to Rs 2 lakh, from Rs 1 lakh at present.
Powers
For the discharge of its functions efficiently, SEBI has been invested with the necessary powers which are:- to approve by−laws of stock exchanges.
- to require the stock exchange to amend their by−laws.
- inspect the books of accounts and call for periodical returns from recognised stock exchanges.
- inspect the books of accounts of a financial intermediaries.
- compel certain companies to list their shares in one or more stock exchanges.
- levy fees and other charges on the intermediaries for performing its functions.
- grant licence to any person for the purpose of dealing in certain areas.
- delegate powers exercisable by it.
- prosecute and judge directly the violation of certain provisions of the companies Act.
SEBI Committees
- Technical Advisory Committee
- Committee for review of structure of market infrastructure institutions
- Members of the Advisory Committee for the SEBI Investor Protection and Education Fund
- Takeover Regulations Advisory Committee
- Primary Market Advisory Committee (PMAC)
- Secondary Market Advisory Committee (SMAC)
- Mutual Fund Advisory Committee
- Corporate Bonds & Securitization Advisory Committee
- Takeover Panel
- SEBI Committee on Disclosures and Accounting Standards (SCODA)
- High Powered Advisory Committee on consent orders and compounding of offences
- Derivatives Market Review Committee
- Committee on Infrastructure Funds
See also
- Bombay Stock ExchangeBombay Stock ExchangeThe Bombay Stock Exchange is a stock exchange located on Dalal Street, Mumbai and is the oldest stock exchange in Asia. The equity market capitalization of the companies listed on the BSE was 1.63 trillion as of December 2010, making it the 4th largest stock exchange in Asia and the 8th largest...
- National Stock Exchange of IndiaNational Stock Exchange of IndiaThe National Stock Exchange is a stock exchange located at Mumbai, Maharashtra, India. It is the 9th largest stock exchange in the world by market capitalization and largest in India by daily turnover and number of trades, for both equities and derivative trading. NSE has a market capitalization...
- Forward Markets Commission (India)
- Securities CommissionSecurities CommissionSecurities Commission a statutory body entrusted with the responsibility of regulating and systematically developing the capital markets in Malaysia.-History:...
- Financial regulationFinancial regulationFinancial regulation is a form of regulation or supervision, which subjects financial institutions to certain requirements, restrictions and guidelines, aiming to maintain the integrity of the financial system...
- List of financial regulatory authorities by country
- Stock exchangeStock exchangeA stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
- Regulation D (SEC)
- Institute of Chartered Accountants of IndiaInstitute of Chartered Accountants of IndiaThe Institute of Chartered Accountants of India is a national professional accounting body of India. It was established on 1 July 1949 as a body corporate under the Chartered Accountants Act, 1949 enacted by the Constituent Assembly of India to regulate the profession of Chartered Accountancy in...