THE SECURITIES AND

EXCHANGE BOARD OF
INDIA (SEBI)

INTRODUCTION

SEBI(Securities and Exchange Board of India) was

constituted on April 12,1988 as a non-statutory body

It is an apex body to develop and regulate the stock

market in India

SEBI is the regulator for the securities market in India,

originally set up by the Government of India in 1988,it
acquired statutory form in 1992 with SEBI Act 1992
being passed by the Indian Parliament.

OBJECTIVES

To protect the interest of investors so that there is a

steady flow of savings in to the capital market.

To regulate the securities market

Ensure fair practices by the issuers of securities so that

they can raise resources at minimum cost.

To promote efficient services by brokers, merchant

bankers and other intermediaries so that they become
competitive and professional.

ORGANISATION
SEBI has divided its activities in to four operational
departments, each headed by an Executive Director.
1.Primary Market Department: It deals with all policy
matters and regulatory issues relating to primary market.
2.Issue Management and Intermediaries Departments
: This department is concerned with inspection of offer
documents and other things like registration, regulation
and monitoring of issue related to intermediaries.
3.Secondary Market Department: It looks after all the
policy and regulatory issues for the secondary market;
administration of the major stock exchanges and other
matters related to it.
4.Institutional Investment Department: It concerned
with framing policy for foreign institutional investors.

In addition to this, there are two other

departments: They are; Legal Department
and Investigation Department, also
headed by officials of the rank of Executive
Directors.
SEBI has two Advisory Committees, one
each for primary and secondary markets.
They provide advisory inputs in framing
policies and regulations. These committees
are non-statutory in nature and SEBI is not
bound by the committees.

FUNCTIONS
Section 11 of the SEBI Act , there are mainly two types of
functions. They are;
1.Regulatory Functions
2.Developmental Functions
Regulatory Functions
(a) Regulating the business in stock exchanges and any other
securities markets.

(b) Registration and regulation of stock brokers ,

sub-brokers , registrar to all issue, merchant
bankers, underwriters, portfolio managers and
such other intermediaries who are associated
with securities market.

(c) Registration and regulation of the working of

Venture capital funds and Collective investment
schemes including mutual funds.
(d) Prohibition of fraudulent and unfair trade
practices relating to securities market.
(e). Prohibition of insider trading in securities.
(f ). Regulating substantial acquisitions of shares
and take over of companies.

Developmental Functions

(a). Promoting investors education.

(Investor Protection and Education Fund)
(b). Training of intermediaries.
(c). Conducting research and publishing information useful to all
market participants.
(d). Promotion of fair practices. Code of conduct for self-regulatory
organizations.
(e). Promoting self-regulatory organizations.

POWERS
SEBI has been vested with the following
powers:
1.Power to call periodical returns from recognized
stock exchange.
2.Power to control and regulate stock exchange.
3.Power to call any information or explanation from
recognized stock exchanges or their members.
4. Power to levy fees or other charges for carrying
out the purpose of regulation.
5. Power to grant registration to market
intermediaries.

6.Power to direct enquiries to be made in

relation to affairs of stock exchanges or
members.

7. Power to grant approval to bye-laws of

recognized stock exchanges.
8. Power to make or amend bye-laws of
recognized stock exchanges.
9. Power to compel listing of securities by
public companies.
10. Power to declare applicability of Section
17 of the Securities Contract (Regulation)
Act is any state or area to grant licenses
to dealers in securities.

SEBI and Central Government

The Central Government has power to

issue
directions
to
SEBI
Board,
supersede the Board, if necessary and
to call for returns and reports as and
when necessary.
The Central Government has also
power to give any guideline or to make
regulations and rules for SEBI and its
operations.

The activities of SEBI are financed by grants

from Central Government, in addition to
fees, charges etc. collected by SEBI.
The fund called SEBI General Fund is set up,
to which, all fees, charges and grants are
credited.
This fund is used to meet the expenses of
the Board and to pay salary of staff and
members of the body.

Legal Framework : Acts

Aug 22, 2014 : Securities Laws (Amendment) Act, 2014

Mar 28, 2014 : The Securities Laws (Amendment) Ordinance, 2014
Oct 03, 2013 : Notification under section 16 and 28 of Securities
Contracts (Regulation) Act, 1956
Sep 16, 2013 : The Securities Laws (Amendment) Second Ordinance,
2013
Sep 13, 2013 : The Securities and Exchange Board of India
(Amendment) Act, 2013
Jul 18, 2013 : The Securities Laws (Amendment) Ordinance, 2013
Sep 20, 1995 : The Depositories Act, 1996 [As amended by the
Securities Laws(Amendment) Act, 2014]
Jan 30, 1992 : Securities and Exchange Board of India Act, 1992 [As
amended by the Securities Laws(Amendment) Act, 2014]
Feb 16, 1957 : The Securities Contracts (Regulation) Act, 1956 [As
amended by the Securities Laws(Amendment) Act, 2014]

Policy Developments
With the objectives of maintaining fair
and efficient markets, developing new
products, improving the securities
market arena, enhancing operational
efficiencies, encouraging small investors,
and attracting new players, various
regulatory changes were made by the
regulators in Indiathe Ministry of
Finance (MoF), the SEBI, and the RBIin
the Indian securities market.

Primary Market

ASBA facility through syndicate / subsyndicate members (SEBI Circular

dated April 29, 2011)
ASBA facility mandatory for QIBs and
NIIs (SEBI Circular dated April 29,
2011)
Adjustment of differential pricing
amount at the time of application for
allotment of specified securities (SEBI
Circular dated May 16, 2011)

Amendment to the SEBI (Issue of Capital

and Disclosure Requirements)
Regulations, 2009 for revision of bid cumapplication form and abridged prospectus
(SEBI Press Release dated July 28, 2011)
Eligibility criteria for companies coming
out with IPOs through the profitability
track record (SEBI Press Release dated
July 28, 2011)e dated July 28, 2011)
Disclosure of quarterly financial results
(SEBI Press Release dated July 28, 2011)

Mode of supplying annual reports to

shareholders (SEBI Press Release dated July
28, 2011)
Disclosure of voting results by listed entities
(SEBI Press Release dated July 28, 2011)
Disclosure of price information of past issues
handled by merchant bankers (SEBI
Notification dated September 23, 2011)
Comprehensive guidelines on offer for sale
(OFS) of shares by promoters through the
stock exchange mechanism (SEBI Circular
dated July 18, 2012)

Collective Investment Vehicles

Option to hold mutual fund units in

demat form (SEBI Circular dated
May 19, 2011)
Investment by foreign investors in
mutual fund schemes (SEBI Circular
dated August 9, 2011)
Commission disclosures by mutual
funds (SEBI Circular dated August
22, 2011)

Capital Markets

Review of Internet-based trading and

securities trading using wireless technology
(SEBI Circular dated June 30, 2011)
Clarification regarding admission of limited
liability partnerships as members of stock
exchanges (SEBI Circular dated July 11, 2011)
SMS and email alerts to investors from stock
exchanges (SEBI Circular dated August 2,
2011)
Simplification and rationalisation of opening
process for trading accounts (SEBI Circular
dated August 22, 2011)

Amendment to SEBI (Buyback of

Securities) Regulations, 1998 (SEBI
Notification dated February 7, 2012)
Exit policy for de-recognised/nonoperational stock exchanges (SEBI
Circular dated May 30, 2012)
Circular dated February 21 2012)

Debt Market

Setting up of Central Electronic Registry

under the SARFAESI Act, 2002 (RBI Circular
dated April 21, 2011)
Guidelines for issue and listing of structured
products/market linked debentures (SEBI
Circular dated September 28, 2011)
Ban on incentives in public issues of debt
(SEBI Circular dated December 26, 2011)
Standardisation of application form and
abridged prospectus for public issue of debt
securities (SEBI Circular dated July 25, 2012)

System for making online

applications for public issue of debt
securities (SEBI Circular dated July
27, 2012)

THANK YOU