SEBI: Know More About The Securities And Exchange Board Of India

The Securities and Exchange Board of India, commonly known as SEBI, plays a vital role in regulating all the players involved in the Indian capital markets. It aims to develop and regulate the markets with its rules and regulations and protects the interest of investors. In this article, we will know more about SEBI, what it does, its structure, and much more.

Through a resolution passed by the government of India, the Securities and Exchange Board of India was first established as a non-statutory body in the year 1988. Later in 1992, the SEBI was established as a statutory regulatory body under the Securities and Exchange Board of India Act, 1992 (15 of 1992). Before the SEBI was established, the Controller of Capital Issues was the regulatory authority for the Indian capital markets.

As per the preamble of the SEBI, its basic functions are to protect the interest of investors and develop and regulate the securities markets. The SEBI headquarters is located at Bandra Kurla Complex, Mumbai. The SEBI also has regional offices in New Delhi, Chennai, Kolkata, and Ahmedabad, and local offices in cities like Bangalore, Kochi, Jaipur, Chandigarh, etc.

The SEBI comprises of about 20 departments including economic and policy analysis, debt and hybrid securities, corporation finance, investment management, etc. These departments are managed by their respective department heads.

The organisational hierarchy of the SEBI consists of the following members:

• The SEBI chairperson, who is appointed by the Government of India.

• Two officers from the Ministry of Finance.

• One member from the Reserve Bank of India.

• 5 other members, who are nominated by the Government of India.

• The primary function of the SEBI is to protect the investor interest in the securities market.

• The SEBI promotes the development of the Indian securities market and regulates its operations.

• It is a platform where stockbrokers, portfolio managers, investment advisors, and other people associated with the securities market can register themselves and provide services to investors.

• The SEBI is responsible for regulating the activities of depositories, custodians of securities, credit rating agencies, foreign portfolio investors, and other market participants.

• SEBI prohibits unfair trade practices like insider trading in the securities market.

• It provides investor education on securities markets.

• The SEBI also monitors the merger and acquisition of listed companies.

Also Read: SEBI Plans ASBA-Like Payment Process To Trade In Shares

The SEBI has the following powers:

• Quasi-judicial powers: The SEBI has the power to pass judgements in cases of fraud and unethical practices in the securities market. This facilitates transparency, fairness and accountability in the securities market.

• Quasi-legislative powers: The SEBI has the power to formulate rules and regulations that will protect investor interests and prevent any unfair trade practices like insider trading in the securities market.

• Quasi-executive powers: The SEBI can implement the rules and regulations and take legal action against those who are caught violating these rules. It can also examine the books of accounts and other necessary documents to collect evidence against any violations.

Also Read: SEBI Cautions Public Against Imposter Portfolio Managers