Fise Meet To Take Up Issue Of Sebi Penalties Imposition

The 10th meeting of Federation of Indian Stock Exchanges (Fise) in New Delhi today will take up the matter of imposition of heavy penalties by Sebi on members of stock exchanges for minor violations.

Member exchanges of the federation have felt that Sebi has been too harsh in the past on imposing penalties on them.

The meeting, which coincides with the first annual general meeting of the federation, will also consider a draft model for administrative restructuring of Fise as proposed by Inter-Connected Stock Exchange of India, and the progress report of the Steering Committee on Inter-connectivity.

Another significant item on the agenda of the meeting is election of the chairman and vice-chairman. Current chairman, Delhi Stock Exchange president Deepak Chowdhry yesterday sounded uncertain about seeking re-appointment. I would like to carry on only if the federation continues to be a common platform to solve the problems of the member exchanges. I would not be interested if it focuses solely on interconnectivity among the exch-anges. I see no significant role for myself then, he told Business Standard.

 

The draft model for Fises administrative restructuring proposes the establishment of a secretariat that would set standards for the domestic industry to raise it to the international levels and establish itself as a self-regulatory organisation. It will also educate investors, brokers, intermediaries, regulators and other government agencies about various dimensions of the capital market.

This draft is seen as offering something to everybody brokers, investors as well as the regulators.

The brokers would have the benefit of standardisation of activities with income tax, excise, Sebi, judiciary and banks, and the benefit of a large credible institution taking up the case of several individuals. Investors would have better protection as fear of disciplinary action and associated damage on reputation will prevent brokers from non-compliance. The regulators would have a single point contact to interact dispassionately with an informed agency rather than with individuals.

In the coming year, Fise intends to address issues like rejuvenation and development of the primary market, development of secondary market to increase liquidity, development of legal and regulatory system in capital markets, increasing investor awareness and participation and setting standards in transparency and responsibility as well as ethics in the capital markets.

The members of the federation formed in April 96 include the stock exchanges of Ahmedabad, Bang-alore, Bhub-aneshwar, Calcutta, Kochi, Coimbatore, Delhi, Guwahati, Hyderabad, Indore, Jaipur, Kanpur, Ludhiana, Magadh, Mangalore, Pune, Saurashtra and Vadodara.