Page 12 - Sebi Norms

Unregistered advisors a threat; 70k misleading posts removed: Narayan

Markets regulator Sebi, in consultation with social media platforms, has removed 70,000 misleading handles and posts since the implementation of the fin-influencer framework last year, said its whole-time member Ananth Narayan G on Friday. Amid concerns over foreign portfolio investors selling equities, the Sebi's whole-time member said the overall flows are not as bad as one would imagine and stressed that they "remain invested" in India. The unregistered investment advisors and research analysts are a "menace" who are cashing in on the rising interest in investments, he said. "Since October 2024, Sebi has worked with social media companies to bring down over 70,000 misleading handles/posts," he said while addressing an event organised by registered investment advisors here. He sought the advisors' help in ensuring compliance and mentioned the UPI 'Payright' handle to help identify Sebi-registered entities and the optional Centralised Fee Collection Mechanism as Sebi's efforts in

Sebi mandates online filing for share reports, dual option until May 14

Markets regulator Sebi on Thursday said that, starting immediately, reports related to certain exemptions in share acquisitions under the 'Takeover Regulations' can be submitted through both email and the newly-introduced intermediary portal. This dual submission system will remain in place until May 14, 2025, after which only the online portal will be used for these filings, Sebi said in a circular. Under the Sebi (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (Takeover Regulations), an acquirer is required to submit a report along with supporting documents and non-refundable fee to Sebi in respect of any acquisition of or increase in voting rights pursuant to certain exemptions. Currently, these reports are filed through email, but the regulator introduced an online system for filing of these reports through Sebi Intermediary Portal (SI Portal) in order to facilitate ease of operations in terms of submission and processing of these reports. Accordingly, in th

Sebi tweaks disclosure norms for shareholding patterns to improve clarity

Markets regulator Sebi on Thursday introduced modifications to the disclosure requirements for shareholding patterns in a bid to improve the clarity. Under the revised format, listed entities are required to disclose details of non-disposal undertakings (NDU), other encumbrances, and the total number of shares pledged or otherwise encumbered, including NDUs, Sebi said in a circular. Additionally, a new column has been added to capture the total number of shares on a fully diluted basis, including warrants, ESOPs, and convertible securities. Furthermore, a footnote in the revised format clarifies that promoter and promoter group entities with "nil" shareholding will also be reflected. These new requirements, which will come into effect from the quarter ending June 30, 2025, aimed at providing further clarity and transparency in the disclosure of shareholding pattern to the investors in the securities market. Sebi has directed stock exchanges to inform listed companies and update t

Sebi mulls clarifying ESOP rules for promoters; minimum holding term in OFS

With an aim to streamline the processes for public issues, markets regulator Sebi on Thursday proposed giving clarifications on minimum holding period for equity shares in Offer for Sale (OFS) as well as on employee stock options (ESOPs) for founders classified as promoters. In its consultation paper, the regulator proposed amendments to the ICDR (Issue of Capital Disclosure Requirements) rules and Sebi (Share Based Employee Benefits and Sweat Equity) norms. The proposals, if implemented, would ensure that the rules are clear and consistent, aligning the eligibility for Offer for Sale (OFS) and Minimum Promoter Contribution (MPC) requirements. The proposals aim to harmonise the treatment of shares obtained through different mechanisms such as compulsory conversion of securities or approved schemes. On minimum holding period for equity shares in OFS, Sebi has suggested amendments in the rules to clarify that the holding period for both the fully paid-up compulsorily convertible ...

Sebi to finalise SOP for settlement regulations amid rise in such cases

Markets watchdog Sebi is in discussions to finalise the standard operating procedure for applying settlement regulations for cases amid rising number of settlement matters. Besides, the Securities and Exchange Board of India (Sebi) is looking at having uniformity in applying the settlement formula for settling cases. Sebi Whole Time Member Kamlesh Chandra Varshney on Sunday said the regulator is working on the SOP for applying the settlement regulations. "It is work in progress... it is in final discussions," he told PTI. Under Sebi norms, subject to various conditions, a matter can be settled without admitting or denying the facts and conclusions of law. On the sidelines of a conference in the national capital, Varshney also said Sebi is looking at how to have consistency in applying the settlement formula. "Formula also has certain value to be given. Now different people should give same value for same situation in different cases... basically uniformity across cases... we will

Sebi expands the scope of unpublished price-sensitive information

Markets regulator Sebi has widened the ambit of the scope of Unpublished Price Sensitive Information (UPSI) by including any proposed fundraising activities agreements which can impact the management or control of the company, restructuring plans, and one-time bank settlements. The move is aimed at enhancing regulatory clarity, certainty and uniformity in compliance in the ecosystem. To give this effect, Sebi, in a notification issued on March 11, amended insider trading regulations. The new rules would come into force from June 10. In its notification, Sebi said that any proposed fundraising activity, upward or downward revisions in credit ratings, other than ESG ratings, and agreements affecting the management or control of the company would be considered as UPSI. Further, developments relating to corporate insolvency processes, including the clearance of resolution plans, one-time settlements, or restructuring of loans and borrowings from banks or financial institutions would fa

HDFC Securities settles Sebi case by paying Rs 65 lakh over violations

Domestic brokerage HDFC Securities on Tuesday settled with markets watchdog Sebi a case pertaining to alleged non-compliance with regulatory norms on payment of Rs 65 lakh towards settlement amount. The order came after the company filed an application with Sebi proposing to settle the alleged violations "without admitting or denying the findings of facts and conclusions of law" through a settlement order. In its settlement order, Sebi said,"the instant adjudication proceedings initiated against the noticee viz., HDFC Securities Ltd, vide SCN (show cause notice)...dated August 8, 2024, are hereby disposed of". In the SCN, it was alleged that requirement of generating alerts for current capacity utilization of critical assets going beyond 70 per cent was not available in the broker's IT policies and procedures with respect to capacity management procedure. Further, the broker had set alerts at more than 80 per cent and 75 per cent for its tool like Meap application and CPU utilisati

Sebi launches AML, CFT certification course for securities intermediaries

Sebi on Monday said it has launched a certification course to foster knowledge about the concepts of Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) among the securities market intermediaries. This certification course aims to create a common minimum knowledge benchmark for employees and associated persons of securities market intermediaries about concepts of AML and CFT and related aspects, provisions of the PMLA & PML rules, and scheduled offences under the Sebi Act and the Companies Act, Sebi said in a statement. Additionally, it aims to promote knowledge about the guidelines pertaining to AML standards, CFT and proliferation financing among the market intermediaries. As part of its ongoing efforts to strengthen the capital market, the regulator has been organising outreach programmes on Anti-Money Laundering and Combating the Financing of Terrorism Provisions for the benefits of securities market intermediaries. The regulator has also been ...

Bondconnect Securities, others pay Rs 16 lakh to settle Sebi case

Bondconnect Securities and two others settled a case with Sebi, over alleged failure to ensure that all orders placed on the online bond platform regarding debt securities were routed through a stock exchange's RFQ platform, on payment of total Rs 15.92 lakh. In addition to Bondconnect Securities (formerly known as Wealthsigns Securities), Aditya Umeshchandra Mehta and Amal Manish Dani also settled the case. This came after the entities filed a settlement application with Sebi proposing to settle the alleged violation of regulatory norms "without admitting or denying the findings of facts and conclusions of law, through a settlement order". Acknowledging the settlement, Sebi in its order said," in view of the acceptance of the settlement terms and the receipt of the settlement amount ... the instant adjudication proceedings initiated against applicants vide SCN (show cause notice) dated October 24, 2024 is disposed of". In the show cause notice, it was alleged that the applicants

Bombay HC stays special court order directing FIR against Buch, five others

The court said order passed 'mechanically', adjourns the matter for four weeks

Sebi income rises 48% to Rs 2,075 cr in FY24, driven by fees, subscriptions

Capital markets regulator Sebi's total income rose 48 per cent year-on-year to Rs 2,075 crore in 2023-24, driven by increased earnings from fees and subscriptions. Of the total income, the regulator earned a fee income of Rs 1,851.5 crore, which was way higher than Rs 1,213.22 crore garnered in the preceding financial year, according to Sebi's annual statement of accounts 2023-24 made public on Tuesday. Additionally, income from investments widened to Rs 192.41 crore from Rs 161.42 crore and other income increased to nearly Rs 18 crore from close to Rs 15 crore. The Securities and Exchange Board of India (Sebi) acknowledged that fees and subscriptions are the major sources of its income. This category of income included earnings from annual fees and subscriptions, listing fees contribution from stock exchanges, income generated from registration, renewal, application and offer documents filed by companies and market infrastructure institutions. Overall, the market watchdog's total

Sebi brings in stricter disclosure norms for IPO-bound companies

New guidelines by Industry Standards Forum to take effect from April 1

Sebi extends deadline for reporting differential rights issues by AIFs

Markets regulator Sebi on Monday extended the deadline by a month to March-end for reporting differential rights issues by Alternative Investment Funds (AIFs). A one-time reporting requirement was set for AIFs that filed their Private Placement Memorandum (PPM) with SEBI on or after March 1, 2020, and issued differential rights outside the standard guidelines. This report was initially due by February 28, 2025. Following the requests for more time from the AIF industry, the deadline has been extended to March 31, 2025, the Securities and Exchange Board of India (Sebi) said in a circular. Earlier, the regulator amended the AIF Regulations, 2012 in November regarding investor rights in AIF schemes. Thereafter in December, laid out guidelines for AIFs offering differential rights to certain investors. Under the guidelines, Sebi directed AIFs to grant investors' rights in investment and distribution of proceeds in proportion to their commitments in a scheme. In simple words, risks as

Markets to policy: 11 challenges for new Sebi chief Tuhin Kanta Pandey

The regulator's 11th chairman will have to balance the interest of investors and policy changes

Govt appoints Finance Secretary Tuhin Kanta Pandey as next Sebi chief

Pandey will be replacing present Sebi chief Madhabi Puri Buch

Market regulator Sebi sets 30-day deadline for NFO corpus deployment

Change comes amid criticism around surge in new offerings by asset managers

Sebi slaps Rs 50 lakh fine on three FPIs for flouting market norms

Capital markets regulator Sebi on Monday slapped penalties totalling Rs 50 lakh on three foreign portfolio investors for exceeding the prescribed limits on short-term investments in debt securities. In three separate orders, the regulator slapped a fine of Rs 20 lakh each on Nexpact Ltd and AIRD Investment Commercial LLC, while it imposed a penalty of Rs 10 lakh on Aviator Global Investment Fund. The orders came after Sebi had carried out inspections of the custodian, Orbis Financial Corporation, for FY22. The regulator observed that investments made by Aviator Global Investment Fund, Nexpact Ltd and AIRD Investment Commercial LLC were not in line with the permissible limits (related to residual maturity) for investment in debt securities applicable for FPIs as on March 31, 2022. Thereafter, Sebi carried out an examination from April 2018 to November 2023 to assess the compliance of the three entities with respect to the provisions of FPI (Foreign Portfolio Investors) rules as well

Sebi slaps Rs 10 lakh penalty on Axis Securities for violating stock rules

Capital markets regulator Sebi has imposed a penalty of Rs 10 lakh on Axis Securities for flouting stock brokers rules as well as other regulatory norms. The penalty has to be paid by the brokerage firm within 45 days, the regulator said in an order on Friday. In an 82-page order, Sebi found that Axis Securities failed to follow regulatory procedures in several areas, including reporting discrepancies and improper handling of client funds. The market regulator found that Axis Securities had inconsistencies in its enhanced supervision reporting to stock exchanges and in stock statements compared to actual holdings in depository accounts. The Securities and Exchange Board of India (Sebi) also observed that Axis Securities also did not settle clients' funds and securities as per preference obtained from the clients and also failed to provide retention statements with account details. Additionally, the brokerage firm passed on penalties imposed by stock exchanges on it for short ...

Monarch Networth Capital settles Sebi case over stock brokers' rule breach

Monarch Networth Capital Ltd on Friday settled with markets regulator Sebi a case pertaining to alleged violation of stock brokers' rule after paying Rs 11.37 lakh towards settlement amount. This came after the entity approached Sebi proposing to settle the pending proceedings "without admitting or denying the findings of fact and conclusions of law" through a settlement order. The stock broker remitted Rs 11.37 lakh and accordingly "the instant proceedings initiated against the applicant (Monarch Networth Capital) vide show cause notice (SCN) dated June 27, 2024, are disposed of ". The Securities and Exchange Board of India (Sebi) had conducted an investigation into the trading activities in the scrip of Atlantaa Ltd during the period August 1, 2022 to November 23, 2022. The investigation was conducted to ascertain whether or not there was any violation of the provisions of Sebi Act 1992 and the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) rules. Following the ...

Small, midcaps' correction: No need for Sebi's statement, says Buch

Sebi Chairperson Madhabi Puri Buch on Friday said there is "no need" for the capital markets regulator to comment on the recent steep correction in small and midcap stocks. Drawing from her statement in March last year on the high valuations in the same stocks, Buch said Sebi had flagged its concerns on the high valuations when it saw a need for it. "On midcaps and small caps, I think that at a point in time when the regulator felt the need to make a statement about it, the statement was made. Today, the regulator feels no need to make an additional statement," she said speaking at an AMFI event here. It can be noted that the small and midcap stocks are in bear territory lately, with some scrips declining by over 20 per cent in quick succession. In March 2024, in what is a rare comment from the regulator, Buch had flagged concerns about the high valuations in the two segments. "There are pockets of froth in the market. Some people call it a bubble, some may call it froth. It may n