SEBI - ECONOMY
News: Explained | SEBI’s measures to tackle incorrect information in the market
What's in the news?
● Markets
regulator Securities and Exchange Board of India (SEBI) floated a consultation
paper proposing measures to effectively tackle market rumours and reviewing
disclosure requirements for material events and information under the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015.
● The
paper puts forth certain enhanced quantitative thresholds for disclosures from
listed entities as well as revised timelines to respond to market rumors.
● As
per the regulator, the proposed measures endeavor to “keep pace with the
changing market dynamics”.
● It adds, “In today’s digital age where information is readily available, it is expected that the listed entities adopt technology-based solutions for ease of compliance.”
SEBI:
● SEBI
is a statutory body, the
non-constitutional body that is set up by a Parliament established on April
12, 1992 in accordance with the provisions of the Securities and Exchange Board
of India Act, 1992.
● It
works under the ownership of the Ministry
of Finance, Government of India.
● The
headquarters of SEBI is situated in Mumbai.
The regional offices of SEBI are located in Ahmedabad, Kolkata, Chennai and
Delhi.
● SEBI
Board consists of a Chairman and several other whole-time and part-time
members.
● Securities Appellate
Tribunal (SAT) has been constituted to protect the
interest of entities that feel aggrieved by SEBI’s decision. It has the same
powers as vested in a civil court.
● SAT’s decision or order can be appealed to the Supreme Court.
Functions of SEBI:
● The
basic functions of SEBI are to protect the interests of investors in
securities. Also, it promotes and regulates the securities market.
● SEBI
is a quasi-legislative and
quasi-judicial body which can draft regulations, conduct inquiries, pass
rulings and impose penalties.
● Its
functions can be generalized to the following three targeted categories:
○ For
issuers, it provides a marketplace in which issuers can increase their finance.
○ For
investors, it ensures safety and provides information needed.
○ For
intermediaries, it enables a competitive professional market for
intermediaries.
● By
Securities Laws (Amendment) Act, 2014, SEBI is now able to regulate any money pooling scheme worth Rs. 100 cr. or more
and attach assets in cases of non-compliance.