Sebi Plans To Tie Up With More Overseas Regulators

"Sebi has entered into a memorandum of understanding (MOU) with Securities Exchange Commission (SEC) of us for sharing information. Sebi also intends to sign pacts with other regulatory bodies," the regulator said in its annual report for 1999-2000 released recently.

Although the regulator did not furnish details, Sebi officials had talks with some of its counterparts in UK, France, South Africa, Kenya, Singapore, Korea, Malaysia, Hong Kong in Delhi during November last year.

The move comes in the wake of directives by International Organisation of Securities Commissions (IOSCO), of which Sebi is a leading member, to its member regulators to carry out reforms in areas of investor protection, transparency and risk.

 

Sebi said it has "partially implemented" the IOSCO directive and a mechanism has been set up for sharing information with government and the Reserve Bank of India on a periodic basis.

Currently, information is shared with its foreign counter parts as and when requested, Sebi said.

However, certain legislations have to be amended in order to share information with other foreign regulators.

"Powers of the regulator to assist foreign regulators or enter into pacts or other co-operation arrangements need to be explicitly provided in the legislation," Sebi said adding necessary changes have to be made in the law.

The regulator also reiterated the need for changing regulations to empower Sebi to supervise and regulate listed companies.

Although the regulator has the power of direct surveillance of the stock exchanges, members and the exchanges and other market intermediaries, Sebi admitted that it has "no powers over listed companies."

In order to ensure effective and credible use of surveillance, Sebi said that it is implementing measures like risk-containment measures, uniform scrip specific price bands, development of stock watch system and suspension of intermediaries among other things.

For risk containment, Sebi has appointed a committee headed by J R Varma. Similarly, it has asked stock exchanges to put in place a stock watch system.