Securities and Exchange Board of India (SEBI)
A major development on the Indian stock market took place in 1988 when the Securities and Exchange Board of India (SEBI) was created by administrative order, on the model of the Securities and Investment Board of the United Kingdom. But it became really powerful in 1992 when the CICA was repealed and the office of the controller of capital matters was abolished. The Securities and Exchange Board Act of 1992 provides for the creation of a board to protect the interests of investors and to promote the development and regulation of the securities market. The SEBI Board of Directors is made up of six members, including the chairman, two members from among officials of the central government ministries responsible for finance and law, two professional members with specific expertise or knowledge regarding the securities market. movables, and a deputy from RBI.
SEBI is entrusted with the following functions:
1. Regulation of activity on the stock exchange and on any other securities market
2. Registration and regulation of the operation of securities brokers, sub-brokers, stock transfer agents, issue bankers, merchant bankers, underwriters, portfolio managers, investment advisers placement and any other intermediary who may be associated with the securities market in any way
3. Registration and regulation of the operation of collective investment undertakings, including mutual funds
4. Promotion and regulation of self-regulatory organizations
5. Prohibition of fraudulent and unfair commercial practices linked to the securities market
6. Promote investor education and training for securities market intermediaries
7. Prohibition of insider dealing on securities
8. Regulation of substantial share acquisitions and takeovers and company mergers
9. Request information, carry out inspections, carry out investigations and audits of the stock exchange and of intermediaries and self-regulatory bodies on the securities market
10. Levying of costs or other modifications to achieve the above objectives.
SEBI has five operational departments. In addition to that, he has two other departments – the legal department and the investigative department. Their scope is as follows:
- The Department of Primary Market Policy, Intermediaries, Self-Regulatory Organizations (SRO) and Grievances and Advice to Investors: it deals with all policy and regulatory matters concerning the primary market, the , investment bankers, portfolio management services, investment advisers. , debenture trustees, underwriters, SROs and investor grievances, counseling, education, and association.
The Department of Issue Management and Intermediaries: it is responsible for the tanking of all prospectuses and letters of offer for public and rights issues, for coordination with the primary market policy, for the ‘registration, regulation, and monitoring of intermediaries linked to emissions.
The Department of Secondary Market Policy, Operation and Exchange, the Department of New Investment Products and Insider Trading: it is responsible for all matters of secondary market policy and regulation and new investment products, registration and monitoring of stock exchange members, administration of some of the stock exchanges, market surveillance and monitoring of price movements and insider trading, and the basis for EDP and SEBI data.
The Department of secondary market administration, inspection, and non-member intermediaries: it deals with the small exchanges of Guwahati, Indore, Mangalore, etc. It is also responsible for the inspection of all stock exchanges, registration, regulation, and control or not – member intermediaries such as sub-brokers.
Institutional investment, mergers and acquisitions, research and publication, and international relations and IOSCO Department: SEBI deals with the policy, registration, and monitoring of foreign institutional investors (FII), mutual funds of national placements, the merger and substantial acquisition of shares, and the IOSCO (International Organization of Securities Commissions), research, publication, and SEBI annual report.
Legal department: this department deals with all legal matters under the supervision of the General Counsel.
Investigations department: this department carries out inspections and investigations under the supervision of the chief of investigations.
SEBI has regional offices in Kolkata, Chennai, and Delhi. It has also formed two non-statutory advisory committees, the primary market advisory committee and the secondary market advisory committee with members of the market player, recognized associate investors, and other eminent persons. SEBI is also a member of the International Organization of Securities Commissions (IOSCO).