Page 19 - Sebi Norms

Sebi launches centralized fee collection for investment advisers, analysts

Market regulator Sebi on Friday announced rolling out a new system -- Centralized Fee Collection Mechanism -- to facilitate collection of fees by Investment Advisers (IAs) and Research Analysts (RAs) from their clients on an optional basis. Under this mechanism, clients will pay fees to IAs/RAs, through a designated platform or portal administered by a recognised Administration and Supervisory Body (ASB), the regulator said in a circular. The move came in response to the growing interest in the securities market and the need for greater transparency in fee payments. The markets regulator said that BSE would specify the operational framework for the mechanism on or before September 23 and make the mechanism operational from October 1. The mechanism has been co-created by BSE Ltd with the help of various stakeholders. While using this mechanism is optional, Sebi asked ASB to take steps to encourage clients and the registered IAs and RAs to avail the services of this mechanism. Fur

Sebi asks exchanges, market infra institutions to ensure minimal data loss

Markets regulator Sebi on Thursday asked stock exchanges and other market infrastructure institutions (MIIs) to ensure that the Recovery Point Objective (RPO) -- the maximum period for which data loss is tolerable due to a technical glitch or disruptions -- is near zero. In market parlance, a recovery point objective (RPO) of near zero means that an institution should aim for almost 100 per cent availability of their data and applications. Further, MIIs need to have a documented methodology for data reconciliation when resuming operations from Disaster Recovery Site (DRS) or any other site as applicable, Sebi said in a circular. Additionally, Sebi has asked MIIs -- stock exchanges, clearing corporations and depositories- to collaborate in developing a standardized definition of 'near zero data loss' and submit the same to it after taking approval from their respective Standing Committee on Technology. In addition to a Disaster Recovery Site, all stock exchanges, clearing ...

Sebi tweaks margin trading facilities' framework to ease collateral burden

To promote ease of doing business, markets regulator Sebi on Wednesday allowed securities funded through cash collateral to be considered as maintenance margin for margin trading facility (MTF). The move will also help alleviate the burden of additional collateral towards the maintenance margin for the margin trading facility. The development took place after the Securities and Exchange Board of India (Sebi) received representations from market participants through the Industry Standards Forum (ISF) to relax the requirement pertaining to the margin trading facility. In a circular, Sebi said stocks or units of equity exchange-traded fund (ETFs) deposited as collateral with the brokers and those purchased using margin trading must be kept separate. There should be no mixing of these two types for calculating the funding amount. "In case the broker has collected cash collateral from the client in the form of margin for availing margin trading facility and the trading member has given

Sebi modifies foreign venture investors' registration, eligibility criteria

Capital markets watchdog Sebi has notified rules to streamline the framework for the registration of Foreign Venture Capital Investors (FVCIs). Under this, the process of granting registration to FVCIs and processing other post-registration references has been delegated to designated depository participants (DDPs) in line with provisions prescribed for FPIs (Foreign Portfolio Investors). An applicant seeking registration as an FVCI is required to engage a DDP to avail of its services for obtaining a registration certificate as FVCI and at all times the DDP and the custodian of the FVCI shall be the same entity. At present, the processing of applications for granting registration to FVCIs and related due diligence is carried out by the Securities and Exchange Board of India (Sebi). "No person shall buy, sell or otherwise deal in securities as a foreign venture capital investor unless it has obtained a certificate granted by a designated depository participant on behalf of the Board

Nippon, Axis mutual funds set to launch active momentum offerings

At present, there is only one active momentum fund, that of Samco MF. Most other fund houses have momentum factor-based funds on the passive side

Sebi revises eligibility criteria for entry, exit of stocks in F&O segment

Capital markets regulator Sebi on Friday revised the eligibility criteria for entry and exit of stocks in the derivatives segment to ensure that only high-quality stocks with sufficient market are allowed to trade in such segment. To be eligible for entry into the derivatives segment, stocks must meet certain criteria based on their performance in the cash market over the previous six months on a rolling basis. The stock's Median Quarter Sigma Order Size (MQSOS) must be at least Rs 75 lakh, revised, from the current Rs 25 lakh and the Market Wide Position Limit (MWPL) must be at least Rs 1,500 crore, increased from the present Rs 500 crore due to a rise in market capitalisation, Sebi said in circular. Additionally, the stock's Average Daily Delivery Value in the cash market has been increased to at least R 35 crore from Rs 10 crore, owing to a significant increase in the average daily delivery value. Stocks, which meet the eligibility criteria in the underlying cash market of any .

Sebi plans to tighten SME IPO norms, migration regulations: Ashwani Bhatia

A consultation paper to review the eligibility conditions, disclosures, and institutional portion expected soon

Market regulator Sebi plans to revamp the informal guidance framework

Additionally, Sebi has proposed to hike the application fee from Rs 25,000 at present to Rs 75,000

Sebi proposes mandatory maintenance of communication record for eight yrs

Markets regulator Sebi on Thursday proposed to make it mandatory for all entities regulated by it to maintain communication records, including acknowledgements, for at least eight years. The move is aimed at improving regulatory compliance, increase transparency, protect investors' interest and boost their confidence in the securities market. In its consultation paper, the regulator suggested that all entities regulated by it should maintain records of all required communications, including acknowledgements, for at least eight years as per their governing regulations. These records must be made available to Sebi upon request, ensuring transparency and accountability. The Securities and Exchange Board of India (Sebi) has sought comments on the consultation paper till September 13. Under the current regulatory regime, Sebi-regulated entities are mandated to communicate various types of information to numerous stakeholders. This enables a regular and timely disbursal of information t

Sebi mulls proposals on PIDs' appointment process at key institutions

Sebi on Thursday came out with proposals connected with the process adopted by the markets regulator for the appointment of public interest directors (PIDs) on stock exchanges, clearing corporations and depositories, in a move aimed at improving shareholders' participation in the process. For improving ease of doing business for PIDs, the proposals include easing documentation requirements when being considered for PID appointment, allowing payment of fixed stipend to them in addition to sitting fees, and reducing cooling off period for their appointment. "The role of PIDs is vital in enhancing corporate integrity and governance standards in any market infrastructure institutions (MIIs). PIDs, especially, play a vital role in balancing the interests of MII's management, its shareholders and more importantly ensuring the safety, efficiency and integrity for the market participants using the infrastructure of these MIIs. "PIDs ensure that in pursuance of their business objectives, MII

Sebi proposes overhaul of investment banking norms amid boom in ECM

10x hike in net worth; more clarity on roles, responsibilities

CDSL, Citibank N A settle alleged regulatory violation cases with Sebi

Leading depository CDSL and global lender Citibank N.A. on Tuesday settled with Sebi cases pertaining to the alleged violation of regulatory norms after paying settlement charges. CDSL and Citibank N.A (DDP) paid Rs 1.3 crore and Rs 40.2 lakh, respectively, towards settlement charges, according to separate orders passed by Sebi. The orders came after Central Depository Services (India) Limited or CDSL and Citibank N.A. filed applications with Sebi proposing to settle the instant proceedings initiated against them, "without admitting or denying the findings of facts and conclusions of law" through settlement orders. In view of the acceptance of the settlement terms and the receipt of the settlement amount, the instant adjudication proceedings initiated against CDSL and Citibank N.A. through show cause notices dated November 13, 2023, and February 9, 2024, respectively, are disposed of, Sebi said in its orders. With regards to the depository, the Securities and Exchange Board of Indi

RHFL fund diversion case: 5-year market ban for Anil Ambani, 24 others

Sebi imposes Rs 624 cr fine on 27 individuals, entities

Market regulator Sebi asks auditors to tread with caution with SMEs

WTM Ashwani Bhatia says preferential allotments used to benefit promoters

CARE Ratings settles CRA rules violation case with Sebi; pays Rs 13 lakh

CARE Ratings Ltd on Friday settled a case pertaining to alleged violation of Credit Rating Agencies (CRA) rules with markets regulator Sebi after paying Rs 13.05 lakh. The order came after CARE Ratings filed an application with Sebi proposing to settle the proceedings initiated against it, "without admitting or denying the findings of facts" through a settlement order. "In view of the acceptance of the settlement terms and the receipt of the settlement amount...the instant adjudication proceedings initiated against CARE Ratings Limited is disposed of in terms of...the Settlement Regulations," Sebi said. The Securities and Exchange Board of India (Sebi) had initiated adjudication proceedings against CARE Ratings Ltd for alleged violation of a clause related to 'Monitoring and Review of Ratings by Credit Rating Agencies (CRAs) specified under CRA Regulations.

ICICI Securities settles matter with Sebi on alleged non-compliance

The broking outfit agreed to pay Rs 69.82 lakh for settling the charges

Sebi proposes changes to regulations regarding debenture trustees

Markets regulator Sebi on Wednesday proposed certain changes to regulations related to debenture trustees. A consultation paper has been issued to provide clarity on the term 'pecuniary relationship' of Debenture Trustee (DT) with the issuer under the existing norms and stakeholders can submit their comments till September 11. At present, there are restrictions on appointment of an entity as a DT in case of a certain level of pecuniary relationship with the issuer. The curbs will be applicable if the entity's pecuniary relationship with the issuer amounts to 2 per cent or more of its gross turnover or total income or Rs 50 lakh or such higher amount as may be prescribed, whichever is lower. The gross income will be calculated for the two immediately preceding financial years or during the current financial year. Against this backdrop, some DTs have sought clarity on whether the remuneration being drawn by DTs from the issuer is included or excluded from the purview of 'pecuniary .

Sebi releases new cyber security framework for regulated entities

Markets watchdog Sebi on Tuesday issued a new cyber security framework wherein all regulated entities are required to have appropriate security monitoring mechanisms, and the fresh norms will be implemented in a graded manner starting from January 2025. Besides, a Cyber Capability Index (CCI) for market infrastructure institutions and qualified regulated entities will be introduced to monitor and assess their cybersecurity maturity and resilience on a regular basis. The Cybersecurity and Cyber Resilience Framework (CSCRF), formulated after consultations with stakeholders, comes at a time when there are rising instances of cyber attacks. The framework will supersede the existing cybersecurity circulars and guidelines for the entities regulated by Sebi, according to a circular. For small regulated entities, Sebi said that stock exchanges NSE and BSE will establish market Security Operation Centres (SOCs) to assist them in meeting the requirements under the new framework. These SOCs

Sebi proposes changes in debenture trustee appointment to smoothen process

To legally validate and streamline disclosure in respect of debenture trustee appointments in offer documents, markets regulator Sebi has proposed to replace the term 'consent letter' with 'debenture trustee agreement'. The change will streamline the process for appointing debenture trustees in the issuance of securities, ensure transparency in the appointment of debenture trustees, and play a crucial role in the securities market. In a consultation paper floated on Saturday, the markets watchdog proposed replacing the term "consent letter" with "debenture trustee agreement" in Sebi's (Issue and Listing of Non-Convertible Securities) rules or NCS regulations. The debenture trustee agreement (DTA), which legally validates the appointment of a debenture trustee, is considered by the regulator to be more significant than the previously used term 'consent letter'. The change will help investors make more informed decisions when investing in debentures. Earlier, a working group noted t

Sebi releases guidelines for market borrowing by Category I, II AIFs

Capital markets regulator Sebi on Monday came out with guidelines for borrowing by Category I and Category II alternative investment funds (AIFs), along with the maximum permissible limit for extension of tenure by Large Value Fund for Accredited Investors (LVFs). Under the rule, Category I and II AIFs are not allowed to borrow or use leverage for investments, except in limited cases for temporary needs. These AIFs are allowed to borrow funds to address temporary funding needs or manage day-to-day operational expenses, with specific limitations. Such borrowing is permitted for up to 30 days, can occur no more than four times in a calendar year, and must not exceed 10 per cent of the investable funds. To facilitate ease of doing business and provide operational flexibility, Sebi has allowed Category I and Category II AIFs to borrow for the purpose of meeting temporary shortfall in amount called from investors for making investments in investee companies ('drawdown amount'), accordin