The Securities and Exchange Board of India (SEBI) board is set to meet on Monday to discuss several key issues and policy measures. The meeting comes amid allegations against SEBI’s chairperson and a protest by SEBI employees against top management. One of the main topics on the agenda is fast-tracking rights issues.
SEBI aims to make fundraising easier for companies by simplifying procedures and reducing the timeframe to about 20 days. This move is intended to promote rights issues as a preferred route over Qualified Institutional Placement (QIP) and preferential issue routes. The board will also discuss measures to streamline the ease of doing business.
This includes the harmonisation of the Issue of Capital and Disclosure Requirements (ICDR) and Listing Obligations and Disclosure Requirements (LODR) norms. The review will cover regulations related to related party transactions, promoter classification, and a unified filing system for IPOs across stock exchanges. Regulations governing merchant bankers are another critical topic.
SEBI is considering raising the net worth requirement for merchant bankers from Rs 5 crore to Rs 50 crore to ensure only serious players operate in the market.
Key issues and policy measures
A long-pending proposal to establish a performance validation agency may also be taken up.
This agency, intended to validate claims made by market participants like investment advisors and research analysts, will initially be voluntary. To address insider trading, SEBI may expand the definition of ‘connected persons’ to include immediate relatives and others closely associated with them. This move aims to close loopholes that allow individuals to exploit insider information through their connections.
The board is expected to review regulations for investment advisors (IAs) and research analysts (RAs). The proposed changes may include removing the condition of passing base certifications every three years, relaxing educational requirements, and eliminating net worth criteria for individual advisors. The board will also discuss the unrest among SEBI employees.
If sufficient disclosures have been made by the SEBI chairperson, the board may address the employees’ grievances extensively. Other topics, including issues related to Foreign Portfolio Investors (FPIs) and debt matters, may also be on the agenda. The SEBI board meeting is expected to address both immediate and long-term regulatory concerns.
The aim is to enhance market integrity, transparency, and efficiency.
