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SecuritiesandExchangeBoardofIndiaWikipedia,thefreeencyclopedia

SecuritiesandExchangeBoardofIndia
FromWikipedia,thefreeencyclopedia

TheSecuritiesandExchangeBoardofIndia(SEBI)is
theregulatorforthesecuritiesmarketinIndia.Itwas
establishedintheyear1988andgivenstatutorypowers
on12April1992throughtheSEBIAct,1992.[1]

SecuritiesandExchangeBoardofIndia

Contents
1History
2Organizationstructure
3Functionsandresponsibilities
3.1Powers
3.2SEBIcommittees
4Majorachievements
5Controversies
6Seealso
7References
8Externallinks
SEBIBhavan,Mumbaiheadquarters

History
ItwasestablishedbyTheGovernmentofIndiaon12
April1988andgivenstatutorypowersin1992with
SEBIAct1992beingpassedbytheIndianParliament.
SEBIhasitsheadquartersatthebusinessdistrictof
BandraKurlaComplexinMumbai,andhasNorthern,
Eastern,SouthernandWesternRegionalOfficesinNew
Delhi,Kolkata,ChennaiandAhmedabadrespectively.It
hasopenedlocalofficesatJaipurandBangaloreandis
planningtoopenofficesatGuwahati,Bhubaneshwar,
Patna,KochiandChandigarhinFinancialYear2013
2014.

Agencyoverview
Formed

12April1992[1]

Jurisdiction

GovernmentofIndia

Headquarters Mumbai,Maharashtra
Employees
Agency
executive
Website

643(2012)[2]
UpendraKumarSinha,
Chairman
www.sebi.gov.in
(http://www.sebi.gov.in)

ControllerofCapitalIssueswastheregulatoryauthoritybeforeSEBIcameintoexistenceitderived
authorityfromtheCapitalIssues(Control)Act,1947.
InitiallySEBIwasanonstatutorybodywithoutanystatutorypower.Howeverin1995,theSEBIwasgiven
additionalstatutorypowerbytheGovernmentofIndiathroughanamendmenttotheSecuritiesand
ExchangeBoardofIndiaAct,1992.InApril1988theSEBIwasconstitutedastheregulatorofcapital
marketsinIndiaunderaresolutionoftheGovernmentofIndia.
TheSEBIismanagedbyitsmembers,whichconsistsoffollowing:
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1. ThechairmanwhoisnominatedbyUnionGovernmentofIndia.
2. Twomembers,i.e.,OfficersfromUnionFinanceMinistry.
3. OnememberfromtheReserveBankofIndia.
4. TheremainingfivemembersarenominatedbyUnionGovernmentofIndia,outofthematleastthree
shallbewholetimemembers.

Organizationstructure
UpendraKumarSinhawasappointedchairmanon18February2014replacingC.B.Bhave.[3]
TheBoardcomprises[4]
Name

Designation

UpendraKumarSinha Chairman
NishantRathi

WholeTimeMember

RajeevKumarAgarwal WholeTimeMember
SRaman

WholeTimeMember

PrakashChandra

JointSecretary,MinistryofFinance

V.K.Jairathmagya

MemberAppointed

AnandSinha

DeputyGovernor,ReserveBankofIndia

NavedMasood

Secretary,MinistryofCorporateAffairs

RajeKumar

PartTimeMember

ListofformerChairmen:[5]
Name

From

To

U.K.Sinha

18February2011 present

C.B.Bhave

18February2008 18February2011

M.Damodaran

18February2005 18February2008

G.N.Bajpai

20February2002 18February2005

D.R.Mehta

21February1995 20February2002

S.S.Nadkarni

17January1994 31January1995

G.V.Ramakrishna 24August1990

17January1994

Dr.S.A.Dave

23August1990

12April1988

Functionsandresponsibilities
ThePreambleoftheSecuritiesandExchangeBoardofIndiadescribesthebasicfunctionsoftheSecurities
andExchangeBoardofIndiaas"...toprotecttheinterestsofinvestorsinsecuritiesandtopromotethe
developmentof,andtoregulatethesecuritiesmarketandformattersconnectedtherewithorincidental
thereto".
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SEBIhastoberesponsivetotheneedsofthreegroups,whichconstitutethemarket:
theissuersofsecurities
theinvestors
themarketintermediaries.
SEBIhasthreefunctionsrolledintoonebody:quasilegislative,quasijudicialandquasiexecutive.Itdrafts
regulationsinitslegislativecapacity,itconductsinvestigationandenforcementactioninitsexecutive
functionanditpassesrulingsandordersinitsjudicialcapacity.Thoughthismakesitverypowerful,there
isanappealprocesstocreateaccountability.ThereisaSecuritiesAppellateTribunalwhichisathree
membertribunalandisheadedbyMr.JusticeJPDevadhar,aformerjudgeoftheBombayHighCourt.[6]A
secondappealliesdirectlytotheSupremeCourt.SEBIhastakenaveryproactiveroleinstreamlining
disclosurerequirementstointernationalstandards.[7]

Powers
Forthedischargeofitsfunctionsefficiently,SEBIhasbeenvestedwiththefollowingpowers:
1. toapprovebylawsofstockexchanges.sebi
2. torequirethestockexchangetoamendtheirbylaws.
3. inspectthebooksofaccountsandcallforperiodicalreturnsfromrecognizedstockexchanges.
4. inspectthebooksofaccountsofafinancialintermediaries.
5. compelcertaincompaniestolisttheirsharesinoneormorestockexchanges.
6. registrationbrokers.
Therearetwotypesofbrokers:
1. circuitbroker
2. merchantbroker

SEBIcommittees
1. TechnicalAdvisoryCommittee
2. Committeeforreviewofstructureofmarketinfrastructureinstitutions
3. AdvisoryCommitteefortheSEBIInvestorProtectionandEducationFund
4. TakeoverRegulationsAdvisoryCommittee
5. PrimaryMarketAdvisoryCommittee(PMAC)
6. SecondaryMarketAdvisoryCommittee(SMAC)
7. MutualFundAdvisoryCommittee
8. CorporateBonds&SecuritizationAdvisoryCommittee

Majorachievements
SEBIhasenjoyedsuccessasaregulatorbypushingsystematicreformsaggressivelyandsuccessively.
SEBIiscreditedforquickmovementtowardsmakingthemarketselectronicandpaperlessbyintroducing
T+5rollingcyclefromJuly2001andT+3inApril2002andfurthertoT+2inApril2003.Therollingcycle
ofT+2[8]means,Settlementisdonein2daysafterTradedate.[9]SEBIhasbeenactiveinsettingupthe
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regulationsasrequiredunderlaw.SEBIdidawaywithphysicalcertificatesthatwerepronetopostal
delays,theftandforgery,apartfrommakingthesettlementprocessslowandcumbersomebypassing
DepositoriesAct,1996.[10]
SEBIhasalsobeeninstrumentalintakingquickandeffectivestepsinlightoftheglobalmeltdownandthe
Satyamfiasco.InOctober2011,itincreasedtheextentandquantityofdisclosurestobemadebyIndian
corporatepromoters.[11]Inlightoftheglobalmeltdown,itliberalisedthetakeovercodetofacilitate
investmentsbyremovingregulatorystructures.Inonesuchmove,SEBIhasincreasedtheapplicationlimit
forretailinvestorstoRs2lakh,fromRs1lakhatpresent.[12]

Controversies
SupremeCourtofIndiaheardaPublicInterestLitigation(PIL)filedbyIndiaRejuvenationInitiativethat
hadchallengedtheprocedureforkeyappointmentsadoptedbyGovtofIndia.Thepetitionallegedthat,
"Theconstitutionofthesearchcumselectioncommitteeforrecommendingthenameofchairmanand
everywholetimemembersofSEBIforappointmenthasbeenaltered,whichdirectlyimpacteditsbalance
andcouldcompromisetheroleoftheSEBIasawatchdog."[13][14]On21November2011,thecourt
allowedpetitionerstowithdrawthepetitionandfileafreshpetitionpointingoutconstitutionalissues
regardingappointmentsofregulatorsandtheirindependence.TheChiefJusticeofIndiarefusedthefinance
ministrysrequesttodismissthePILandsaidthatthecourtwaswellawareofwhatwasgoingoninSEBI.
[13][15]HearingasimilarpetitionfiledbyBangalurubasedadvocateAnilKumarAgarwal,atwojudge
SupremeCourtbenchofJusticeSSNijjarandJusticeHLGokhaleissuedanoticetotheGovtofIndia,
SEBIchiefUKSinhaandOmitaPaul,SecretarytothePresidentofIndia.[16][17]
Further,itcameintolightthatDrKMAbraham(thethenwholetimememberofSEBIBoard)hadwritten
tothePrimeMinisteraboutmalaiseinSEBI.Hesaid,"Theregulatoryinstitutionisunderduressandunder
severeattackfrompowerfulcorporateinterestsoperatingconcertedlytoundermineSEBI".Hespecifically
saidthatFinanceMinister'soffice,andespeciallyhisadvisorOmitaPaul,weretryingtoinfluencemany
casesbeforeSEBI,includingthoserelatingtoSaharaGroup,Reliance,BankofRajasthanandMCX.[18][19]
...

Seealso
NationalStockExchangeofIndia
ForwardMarketsCommission(India)
SecuritiesCommission
Financialregulation
Listoffinancialregulatoryauthoritiesbycountry
Stockexchange
RegulationD(SEC)
InstituteofCharteredAccountantsofIndia
InstituteofCompanySecretariesofIndia

References
1. "AboutSEBI"
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2.
3.
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5.
6.
7.
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9.
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14.
15.
16.
17.
18.
19.

SecuritiesandExchangeBoardofIndiaWikipedia,thefreeencyclopedia

(http://web.archive.org/web/20101003235606/http://www.sebi.gov.in/sebiweb/stpages/about_sebi.jsp).SEBI.
Archivedfromtheoriginal(http://www.sebi.gov.in/sebiweb/stpages/about_sebi.jsp)on3October2010.Retrieved
26September2012.
http://www.sebi.gov.in/acts/EmployeeDetails.html
Arendezvous:CBBhave's3yearsatSEBICNBCTV18(http://www.moneycontrol.com/news/cnbctv18
comments/arendezvoucbbhave%60s3yearsatsebi_524022.html).Moneycontrol.com.Retrievedon201307
29.
"MicrosoftWordBoardmembers.doc"(http://www.sebi.gov.in/Board.pdf)(PDF).Retrieved20120228.
"FormerChairmenofSEBI"(http://www.sebi.gov.in/chairmen.pdf)(PDF).SEBI.Retrieved19February2011.
GovtappointsJPDevadharasnewPresidingOfficerofSecuritiesAppellateTribunalEconomicTimes
(http://articles.economictimes.indiatimes.com/20130715/news/40590436_1_securitiesappellatetribunalsat
presidingofficerjogsingh).Articles.economictimes.indiatimes.com(20130715).Retrievedon20131206.
"CyrilShroffManagingPartnerMumbai&NationalCapitalMarketheadAmarchand"
(http://barandbench.com/content/212/cyrilshroffmanagingpartnermumbainationalcapitalmarkethead
amarchand#.U3MCRvmSyLF).http://barandbench.com/.
"DiscussionPaperImplementationofT+2rollingsettlement"(http://www.sebi.gov.in/commreport/t2.pdf)(PDF).
SEBI.Retrieved25October2012.
"SebigetsrollingonT+2settlementschedule"(http://articles.economictimes.indiatimes.com/200301
04/news/27546293_1_settlementcycleinstitutionaltradest5).economictimes.4January2003.Retrieved
25October2012.
Sebis25yearjourney(http://www.livemint.com/Industry/xer1j7wBRbQH1UTOBVrRaL/Sebis25year
journey.html).Livemint(20130521).Retrievedon20130729.
"SEBImakesitmandatoryforcompaniestodisclosepromoters'shares"
(http://articles.economictimes.indiatimes.com/20111006/news/30250534_1_promoterspledgedisclosures).
EconomicTimes.6October2011.Retrieved26October2012.
"Sebidoublesretaillimit,tightensIPOnorms"(http://business.rediff.com/report/2010/oct/26/sebitightensipo
norms.htm).business.rediff.com.Retrieved27October2010.
"IsSebisAutonomyUnderThreat?"(http://forbesindia.com/printcontent/30372).15November2011.Retrieved
10April2012.
"PILallegesnexusinSebiappointments"(http://timesofindia.indiatimes.com/business/indiabusiness/PIL
allegesnexusinSebiappointments/articleshow/10612161.cms).5November2011.Retrieved10April2012.
"SCallowseminentcitizenstowithdrawpetitionagainstSEBIchief'sappointment"
(http://www.moneylife.in/article/8/21576.html).21November2011.Retrieved10April2012.
"NoticetoCentreonquowarrantoagainstSEBIchief"(http://www.thehindu.com/news/national/sebichief
appointmentunderscscrutiny/article3938457.ece).TheHindu.26September2012.Retrieved26September
2012.
"SCseeksCentresreplyonPILonSebichairmansappointment"
(http://www.deccanherald.com/content/281208/scseekscentresreplypil.html).TheDeccanHerald.26
September2012.Retrieved26September2012.
"KMAbraham'slettertoPM"(http://www.scribd.com/firstpost/d/70646038KMAbrahamsLettertoPM).
PrimeMinister'sOffice.20October2011.Retrieved11April2012.
"PranabChidufeudmayberevivedoverSebichiefPIL"(http://www.firstpost.com/business/pranabchidufeud
mayberevivedoversebichiefpil129459.html).12November2011.Retrieved11April2012.

Externallinks
SecuritiesandExchangeBoardofIndiaWebsite(http://www.sebi.gov.in)
ApracticalguidetostartastockSubBrokerBusinessinIndia
(http://www.tikshare.com/showArticle/5/ApracticalguidetostartastockSubBrokerBusiness)
Retrievedfrom"https://en.wikipedia.org/w/index.php?
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OrganisationsbasedinMumbai FinancialregulatoryauthoritiesofIndia
Governmentagenciesestablishedin1992 GovernmentagenciesofIndia
SecuritiesandExchangeBoardofIndia EconomichistoryofIndia(1991present)
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