Important Points about Securities and Exchange Board of India (SEBI)

    Important Points about Securities and Exchange Board of India (SEBI)
    Important Points about Securities and Exchange Board of India (SEBI):
    Important points that we have to know about Securities and Exchange Board of India (SEBI) was given here, which will be more helpful for the candidates those who are preparing for the upcoming exams.

    Securities and Exchange Board of India (SEBI):
     
    1).TheSecurities and Exchange Board of India (SEBI) is the regulator for the securities market in India
    2).It was established by the Government of India in1988 as a replacement of theController of Capital Issues (CCI) which was the regulatory authority before SEBI
    3).CCI acquired its authority from theCapital Issues (Control) Act, 1947
     
    4).Initially SEBI was a non-statutory body without any statutory power but in1995 the government added statutory power to SEBI through theSecurities and Exchange Board of India Act, 1992
     
    5).SEBI Headquarters –Bandra Kurla Complex, Mumbai, Maharashtra
     
    6).Chairman – Ajay Tyagi.
     
    7).The mainobjectives of SEBI are as follows
    ·        Regulating activities of stock exchange
    ·        To protect the rights of investors and ensure the safety of their investment
    ·        To prevent malpractices by balancing its self regulating business and statutory regulations
    ·        To regulate and develop a code of conduct for intermediaries
    8).SEBI is responsible for the needs of the following three groups
    ·        Issuers  – SEBI provides a market place in which the issuers can raise finance fairly
    ·        Investors– SEBI provides protection and supply of accurate and correct information
    ·        Intermediaries– SEBI provides a competitive professional market
    9).The SEBI is managed by its following members
    ·        The chairman nominated by Union Government –Upendra Kumar Sinha
    ·        2 members – Officers from theUnion Finance Ministry
    a.   Prakash Chandra – Joint Secretary, Ministry of Finance
    b.   Naved Masood – Secretary, Ministry of Corporate Affairs
    ·        1 member from the Reserve Bank of India –Anand Sinha (Deputy Governor, RBI)
    ·        5 members nominated by the government out of them at least 3 shall be full-time members
    a.   Nishant Rathi – full-time member
    b.   Rajeev Kumar Agarwal – full-time member
    c.   S. Raman – full-time member
    d.   V. K. Jairath Magya – Part-time member
    e.   Raje Kumar – part-time member
    10).Functions of SEBI are as follows
    ·        Protective Functions are performed to protect the interest ofinvestors and provide safety for their investment
    a.   It involves to keep a check onPrice Rigging i.e., manipulation of prices of securities with the main objective of creating inflation
    b.   It involves prevention ofinsider trading i.e., a person from the company with sensitive information that can affect the prices of securities uses that information to make profit
    c.   To prohibitFraudulent andUnfair Trade Practices i.e., not allowing the companies to make misleading statements which will induce the sale of purchase of securities by any other person
    ·        Developmental Functions are performed by the SEBI to promote and develop the activities of thestock exchange and increase its business
    a.   It promotes training ofintermediaries of the securities market
    b.   SEBI promotes the activities of the stock exchange by adopting flexible and adoptable ways likeinternet trading and initial public offer of primary market
    ·        Regulatory Functions are performed by SEBI to regulate the business in stock exchange
    a.   SEBI regulates the working ofmutual funds and takeover of companies
    b.   It conducts inquiries and audit of stock exchanges
    c.   It frames rules and regulations and acode of conduct to regulate the intermediaries
    11).Thecommittees formed by SEBI for its functioning are as follows
    ·        Technical Advisory Committee
    ·        Committee for review of structure of market infrastructure institutions
    ·        Advisory Committee for the SEBI Investor Protection and Education Fund
    ·        Takeover Regulations Advisory Committee
    ·        Primary Market Advisory Committee (PMAC)
    ·        Secondary Market Advisory Committee (SMAC)
    ·        Mutual Fund Advisory Committee
    ·        Corporate Bonds and Securitization Advisory Committee
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