SECURITIES AND EXCHANGE BOARD OF INDIA
Part – 1
Securities and Exchange Board of India or SEBI plays a vital role in regulating all the players in the capital market of India. It aims at developing the capital markets by various regulations and to protect the interest of investors. Give it a read to know more about SEBI:
WHAT IS SEBI?
SEBI is a regulatory body of the Indian Government which controls the securities market. It came into existence on 12th April 1992 under the SEBI Act. The headquarters are at the Bandra Kurla Complex, Mumbai, India. It has regional offices in other cities such as Kolkata, Ahmedabad, Chennai, and New Delhi. These cover all the four regions of India – North, South, East, and West.
STRUCTURE OF SEBI
SEBI has a corporate framework comprising of different departments each managed by their respective head. Some of the departments are: communications, human resources, foreign portfolio investors, commodity/derivative market regulation, collective investment schemes, and legal affairs department, others.
THE HIERARCHY OF SEBI
It consists of nine members, here:
- A chairman nominated by the ‘Government of India
- Only two members – Who are officers from the ‘Union Finance Ministry’
- Only one member – From the ‘Reserve Bank of India’
- Five other members who are nominated by the ‘Union Government of India’.
POWER AND AUTHORITY OF SEBI
SEBI has three main powers. Here:
- Quasi-judicial: SEBI can deliver judgements related to securities market that pertains to fraud and other un-ethical practices. This helps to ensure transparency, accountability, and fairness in the securities market.
- Quasi-legislative: SEBI can frame rules and regulations for protecting the interests of the investors. It consists of Listing Obligation, Disclosure Requirements, and Trading Regulations.
- Quasi-executive: SEBI is empowered enough to put up a case against any kind of violators. Also, they can authorize to inspect documents and books in case of any violations.
OBJECTIVES OF SEBI
- Protection to the Investors: The objective is to protect the interest of people in the stock market, also, providing them with a healthy environment.
- Fair & Proper Functioning: Keeping a close check over the activities of the financial intermediaries like sub-brokers, brokers, etc. SEBI is also responsible for the orderly functioning of the capital market.
- Prevention of Malpractices: Preventing malpractices is one of the crucial objectives of SEBI. Any kind of fraudulent activity relating to trading.
- A Code of Conduct: Regulating and developing a code of conduct for intermediaries such as underwriters, brokers, etc.
- Balancing: Establishing a balance between self-regulation and statutory regulation by the securities industry.