What is SEBI?
The Securities and Exchange Board of India (SEBI) is the designated regulatory body for the finance and investment markets in India. The board plays a vital role in maintaining stable and efficient financial and investment markets by creating and enforcing effective regulation in India’s financial marketplace. It is similar to the U.S. Securities and Exchange Commission (SEC). It was established in the year 1988 as a non-statutory body and in 1992 it became an autonomous body in the year 1992 under the SEBI Act 1992 which was passed in the Indian Parliament. This act was passed under the Prime Ministership of P.V. Narasimha Rao.
Composition of SEBI’s Management team
Management team of SEBI comprises of 9 people:-
- 1 Chairman (Nominated by Union Govt of India)
- 2 Members (Officers from Union Finance Ministry)
- 1 Member (Is from Reserve Bank of India)
- 5 other members (Nominated by Union Govt of India)
Reason for the creation
In the 1980s there was a large participation of investors in the capital market. Seeing this kind of participation the brokers, merchant bankers, companies and others started malpractices like violation of rules and regulation of the stock exchanges, delay in delivery of shares, rigging of prices, unofficial premium on new issues etc. This malpractices resulted in a lot of unsolved grievances of the investors. Such malpractices was only possible because of lack of proper penal provision and legislation. Thus is 1988 SEBI was set-up as a non-statutory body.
Responsible
SEBI is responsive to three sections of the capital market
- Investors
- Security issuers
- Market intermediaries
Functions
- Regulate
- Development
- Protection
Objectives:
- Projection
- Competitive and Professional
- Prevention of Malpractice
- Orderly Function
- Balancing
SEBI in News
| News | Source | Date |
| Satyam case: Sebi bars Price Waterhouse from auditing listed firms for 2 years | The Hindu | 11/01/2018 |
| SEBI imposes Rs 2 lakh fine on Motilal Oswal Securities | Moneycontrol | 11/01/2018 |
| Sebi bans Media 9th Creations, directors from markets | Outlook India | 11/01/2018 |
| Sebi extends time for norms to prevent unauthorised trade | Outlook India | 11/01/2018 |
| SEBI orders attachment of bank, demat accounts of RC Overseas | Moneycontrol | 10/01/2018 |
| Budget 2018: SEBI seeks ‘unit-based’ taxation for alternative investment funds | Moneycontrol | 09/01/2018 |
Facts of SEBI
- SEBI has 4 regional offices.
- North Regional Office in New Delhi
- South Regional Office in Chennai
- Western Regional Office in Ahmedabad
- Eastern Regional Office in Kolkata
- Each regional offices have local offices under their supervision.
- Ajay Tyagi is the 9th chairman of SEBI
- Securities Appellate Tribunal which is a three-member tribunal and is headed by Mr Justice J P Devadhar, a former judge of the Bombay High Court
My Take
According to me, SEBI has taken great efforts to control malpractices and to protect the interest of the investors, security issuers and intermediaries. If SEBI wasn’t given the status of an autonomous body in the year 1992 there won’t be such an active participation in the capital market which is seen today.
This article was written by me for The Economic Transcript, Mithibai Economic Forum, Mithibai College.