The Hindu Business Line : Amendment to SEBI Act likely

A comprehensive amendment to Securities and Exchange Board of India Act is on the anvil, along with the proposed setting up a self-regulatory organisation (SRO) for improved monitoring of bourses.

The amendment to the SEBI Act is likely to give more powers to the capital market regulator and effecting changes in the settlement process, the Chairman of SEBI, Mr M. Damodaran, said here on Thursday.

Addressing a seminar on `Potential Strengths of Indian Capital Market and Blueprint for Future', Mr Damodaran said issues such as the existing settlement process and disgorgement would be addressed through the amendment.

Besides, the current SEBI Act requires registration of the sub-brokers to be done by the capital market regulator.

"In the amendment, we would want to spin off this provisions to the respective exchanges," he added.

Setting up SRO

Mr Damodaran also said SEBI is planning to set up a SRO soon for surveillance of the capital market.

"We are hoping to set up a body of market experts, which would include retired members of SEBI, representatives of mutual funds, asset management companies, who can carry out surveillance," he said. The term of the SRO has not yet been decided, but it could be three to five years, he indicated.

The Chairman further said SEBI is working on simplification of procedures for coming out with rights issues.

"We would make the announcement about the new norms soon," he said.

The proposal for having an exchange for Small Scale Enterprises is also under active consideration, Mr Damodaran said.

He also indicated that there was no need for too many exchanges and the exchanges, which do not follow proper accounting standards need not be continued with.

As regards the compliance cost, he said, "Instead of making disclosure to the BSE, NSE and SEBI, the regulator is working on uniform e-filing of disclosure details.

This way, while compliance is not diluted, its cost is minimised," he said.

As regards development of the corporate bond market, he said, "SEBI is working on development of the corporate bond market in close touch with RBI."

He stressed that that there were no differences with RBI on the issue and that both the regulators are working to develop vibrant corporate bond market.

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