Key Decisions Taken by Securities and Exchange Board (“SEBI”) of India in its Board Meeting Held On April 26, 2017

SEBI, in its Board Meeting held on April 26, 2017, deliberated upon and concluded on various initiatives for improving the facilities being offered to the stakeholders. The key decisions taken by SEBI are as follows:

  • Amendment to Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2012- to enable the Commodity Derivatives Exchanges to organize trading of ‘options', the Board, after undertaking due public consultation process, has approved a proposal to amend the relevant provisions of Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2012;
  • Strengthening the Monitoring of Utilization of Issue Proceeds- As per the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, require mandatory appointment of „Monitoring
  • Agency‟ if the issue size of specified securities exceeds Rs. 500 Cr. The Board in its meeting decided to for mandatory appointment of Monitoring Agency where the issue size (excluding offer for sale component) is more than Rs. 100 Cr.;
  • Amendment to SEBI (Foreign Portfolio Investor) Regulations, 2014- An express provision shall be inserted in the regulations to prevent Resident Indians/NRIs or the entities which are beneficially owned by Resident Indians/NRIs from subscribing to Offshore Derivative Instruments.
  • Integration of broking activities in Equity Markets and Commodity Derivatives Markets under single entity- Consequent to merger of Forward Market Commission with SEBI, commodity derivatives brokers are also being regulated by SEBI. However, as per extant Securities Contracts (Regulation) Rules (“SCR Rules”), 1957 and SEBI (Stock Brokers and Sub-brokers) Regulations, 1992, a stock broker /clearing member dealing in commodity derivatives cannot deal in other securities or vice versa, except by setting up of a separate entity. In this regard, the Board approved the proposal to remove this restriction by amending Stock Brokers Regulations and also to recommend to Government of India for amending SCR Rules accordingly.