Govt mulls removing age cap for Sebi chief

The government is mulling to remove the age criteria for selection of the Securities and Exchange Board of India (Sebi) chief, said two people with knowledge of the development. Under the current rules, only those between the ages of 50 and 60 can apply for the post, while the retirement age has been set at 65 years.

The move is aimed at attracting relatively younger talent to head the regulatory body, sources said. The move could also be in sync with the criteria for appointing the Reserve Bank of India (RBI) governor, where is there is no lower or upper age limit.

Sources in the know said there is a thinking in policy circles that there is no need for the law to stipulate the retirement age for the Sebi chairman when there is none for the RBI governor. 

The move comes at a time when the government is at an advanced stage of finalising the new Sebi chief as the current chairman’s tenure is ending on March 1. 

“The Prime Minister's Office (PMO) is in talks with various shareholders to remove the age criteria just like in the case of the RBI governor,” said a government source in the know.

Sandeep Parekh, founder, Finsec Law Advisors, said the rule change can be done through a notification and may not require amendments to the Sebi Act.

It couldn’t be ascertained if the proposal is being mooted keeping in mind a particular candidate for the current selection process.

The search-cum-selection panel to appoint the next Sebi chief is said to have shortlisted around eight candidates for the post of chairman. Power Secretary P K Pujari, Additional Secretary at the finance ministry Ajay Tyagi and Economic Affairs Secretary Shaktikanta Das are said to be the front-runners for the post.

The candidate will replace 64-year-old U K Sinha (pictured), who has become the second longest serving Sebi chairman after D R Mehta, who was at the regulator’s helm between February 1995 and February 2002.

Legal experts say removing the upper age limit would be fine, but the government should ensure there is a change in guard after three or five years to bring in fresh thinking at the securities regulator.

Last year, too, the government had called for applications but then decided to extend Sinha's term, citing a need for continuity amid volatility in the global markets.