The Securities and Exchange Board of India (SEBI) was established in 1988 and the powers of

regulation, supervision and legislation were given under SEBI Act, 1992.

SEBI is a quasi-legislative, quasi-judicial and quasi-executive statutory body established under the
SEBI Act of 1992. Its main purpose is to protect the interests of the investors and to promote and
regulate the securities market.

The following are the main functions of SEBI

1. Providing a marketplace for issuers to raise finance through different financial instruments
2. Promote the securities market by maintaining a competitive professional environment for
intermediaries like Stock Brokers, Stock Exchanges, merchant banks etc.
3. Protect the interests of investors by providing precise and accurate information
4. Regulation and supervision of Issuers, Intermediaries and Investors
5. Drafting legislation for the securities market
6. Conduct Enquiries on issuers and intermediaries
7. Pass rulings and impose penalties
8. Regulation of all money pooling schemes having a value greater than 100 Crores.

Due to the immense power being vested in the hands of SEBI by GoI, it was decided to provide a
platform in the interest of entities who are aggrieved by the decision of SEBI. Thus, the Securities
Appellate Tribunal (SAT) was set up. However, entities can approach the Supreme Court of India in
case of dissatisfaction with SAT's decision.

Many changes have been introduced in the Securities market by SEBI to improve efficiency and
promote investments
• In 2023, the T+1 Days Trading settlement system has been introduced which will be
implemented in a phased manner.
• In 2009, Entry load in Mutual funds was banned by SEBI.
• In 2003, SEBI introduced a mechanism for the registration of Foreign Institutional Investors
(FII). SEBI discourages investments of FIIs through P-notes to restrict the flow of black
money in the market.
• SEBI has introduced e-IPOs which have improved transparency in allotments.
• SEBI has also introduced Index-based Circuit breakers in Stock Exchange Market to control
panic selling and mass buying.
a. Market is suspended for 1 hour, in case of movement of Index in the range of +/-10%.
b. Market is suspended for 2 hours, in case of movement of Index in the range of +/-15%.
c. Market is suspended for the day, in case of movement of Index in the range of +/-20%.