2. INTRODUCTION
• SEBI (Securities and Exchange board of India)
was constituted on April 12,1988 as a non-
statutory body.
• It is an apex body to develop and regulate the
stock market in India.
• SEBI is the regulator for the securities market in
India, originally set up by the Government of India
in 1988, it acquired statutory from in 1992 with
SEBI Act 1992 being passed by the Indian
Parliament.
3. HEADQUTERS :
Bandra Kurla Complex in
Mumbai, Maharashtra, and has Northern,
Eastern, Southern and Western Regional
Offices in New
Delhi, Kolkata, Chennai and Ahmedabad
respectively.
It has opened local offices at Jaipur and Bangalore
and was planning to open offices at Guwahati,
Bhubaneswar, Patna, Kochi and Chandigarh in
Financial Year 2013 - 2014.
Location of SEBI
4. REASONS FOR ESTABLISHMENT OF
SEBI
• Started in stock market such as price rigging.
• Unofficial premium on new issue.
• Delay in delivery of shares.
• Violation of rules and regulations of stock
exchange and listing requirements.
• So government of India decided to set up an
agency or regulatory body known as Securities
Exchange Board of India (SEBI).
5. Members of SEBI
Name Designation
Ajay Tyagi Chairman
Gurumoorthy Mahalingam Whole Time Member
S. Raman Whole Time Member
Madhabi Puri Buch Whole Time Member
Shaktikanta Das Part Time Member
N.S. Vishwanatham Part Time Member
Arun P Sathe Part Time Member
Tapan Ray Part Time Member
6. Members of SEBI
• Chairman of SEBI is been appointed by the
Union Government of India.
• Two members, i.e. officers from Union
Finance Ministers.
• One member from RBI.
• The remaining five members are
nominated by Union Government Of India,
Out of them at least three shall be whole
time members.
7. DEFINATION
• Whole Time Member:
A person who works for minimum 35 to 40
hours a week are counted as an whole time
member.
• Part Time Member:
A person who works between 1 to 34 hours a
week.
8. List Of Chairman
Name From To
Dr. S A Dave 12-April-88 23-Aug-90
G V Ramakrishna 24-Aug-90 17-Jan-94
S S Nadkarni 17-Jan-94 31-Jan-95
D R Mehta 21-Feb-95 20-Feb-02
G N Bajpai 20-Feb-02 18-Feb-05
M Damodaran 18-Feb-05 18-Feb-08
C B Bhave 18-Feb-08 18-Feb-11
U K Sinha 18-Feb-11 10-Feb-17
Ajay Tyagi 10-Feb-17 Present
9. OBJECTIVES OF SEBI
• The overall objectives of SEBI are to protect the
interest of investors and to promote the
development of stock exchange and to
regulate the activities of stock market. The
objectives of SEBI are:
To regulate the activities of stock exchange.
To protect the rights of investors and ensuring
safety to their investment.
10. To regulate and develop a code of conduct
for intermediaries such as brokers,
underwriters, etc.
To prevent fraudulent and malpractices by
having balance between self regulation of
business and its statutory regulations.
Continue....
11. FUNCTIONS OF SEBI
• The SEBI performs functions to meet its
objectives. To meet three objectives SEBI
has three important functions. These are:
1. Protective functions.
2. Developmental functions.
3. Regulatory functions.
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1. Protective Functions:
These functions are performed by SEBI to
protect the interest of investor and provide safety of
investment.
• As protective functions SEBI performs following
functions:
(i) It Checks Price Rigging:
Price rigging refers to manipulating the prices
of securities with the main objective of inflating or
depressing the market price of securities. SEBI prohibits
such practice because this can defraud and cheat the
investors.
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(ii) It Prohibits Insider trading:
Insider is any person connected with the company such
as directors, promoters etc. These insiders have sensitive
information which affects the prices of the securities. This
information is not available to people at large but the insiders
get this privileged information by working inside the company
and if they use this information to make profit, then it is
known as insider trading,
e.g., the directors of a company may know that company will
issue Bonus shares to its shareholders at the end of year and
they purchase shares from market to make profit with bonus
issue. This is known as insider trading. SEBI keeps a strict
check when insiders are buying securities of the company
and takes strict action on insider trading.
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2. Developmental Functions:
These functions are performed by the SEBI to promote
and develop activities in stock exchange and increase the
business in stock exchange. Under developmental categories
following functions are performed by SEBI:
SEBI tries to promote activities of stock exchange by
adopting flexible and adoptable approach in following way:
(A) SEBI has permitted internet trading through registered
stock brokers.
15. (B) SEBI has made underwriting optional to
reduce the cost of issue.
(C) Even initial public offer of primary market
is permitted through stock exchange.
Continue....
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3. Regulatory Functions:
These functions are performed by SEBI to regulate the business
in stock exchange. To regulate the activities of stock exchange following
functions are performed:
1. SEBI registers and regulates the working of stock brokers, sub-brokers,
share transfer agents, trustees, merchant bankers and all those who are
associated with stock exchange in any manner.
2. SEBI registers and regulates the working of mutual funds etc.
3. SEBI regulates takeover of the companies.
4. SEBI conducts inquiries and audit of stock exchanges.
19. Rules of SEBI
2014 Companies (Issue of Global Depositories Receipts) Rules, 2014
2014 Companies (Prospectus and Allotment of Securities) Rules, 2014
2014 Companies (Share Capital and debentures) Rules, 2014
2005 Depositories (Procedure for Holding Inquiry and Imposing Penalties
by Adjudicating Officer) Rules, 2005
2005 Securities Contracts (Regulations) (Procedure for Holding Inquiry
and Imposing Penalties by Adjudicating Officer) Rules, 2005
2004 Securities Transaction Tax Rules, 2004
2003 Securities Appellate Tribunal (Salaries, Allowances and other Terms and
Conditions of Presiding Officer and other Members) Rules, 2003
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2000 Securities Appellate Tribunal (Procedure) Rules, 2000
2000 Securities Contracts (Regulations) (Appeal to Securities Appellate
Tribunal) Rules, 2000
1998 Depositories (Appeal to Central Government) Rules, 1998
1997 Securities Appellate Tribunal (Salaries and Allowances and other
Conditions of Service of the Officers and Employees) Rules, 1997
1997 Securities Contracts (Regulations) Rules, 1957
1995 SEBI (Procedure for Holding Inquiry and Imposing Penalties by
Adjudicating Officer) Rules, 1995
1994 SEBI (Annual Report) Rules, 1994
1994 SEBI (Form of Annual Statement of Accounts and Records) Rules, 1994
1993 SEBI (Appeal to Central Government) Rules, 1993
1992 SEBI (Terms and Conditions of Service of Chairman and Members)
Rules, 1992
1986 Securities Contracts
(Reference to the Company Law Board)
Rules, 1986
21. REGULATION & STRUCTURE OF
MUTUAL FUND IN INDIA
• INTRODUCTION OF MFs:-
A mutual fund in India occurred in 1963, When
the Government of India launched Unit Trust of
India (UTI) under the direction of Akash Behl.
• Mutual funds are regulated by SEBI in India.
• Money markets MFs are also regulated by RBI
apart from being regulated by SEBI.
22. STRUCTURE OF MFs in India
The structure of Mutual Funds in
India is a three-tier one.
There are three distinct entities
involved in the process –
The Sponsor :-
(who creates a Mutual Fund),
Trustees & the Asset
management company:-
(Which oversees the fund
management).
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AMC ( Asset Management Company)
1. Ensure day to day management
of the fund.
2. Earns investment management fee for
managing fund & Capital of the AMC is
contributed by the sponsor.
TRUST
1. Keeps a check on the AMC.
2. Ensure that the fund is managed
in best interest of investors.
SPONSOR
1. Creates the Mutual fund & AMC
2. Approaches SEBI to set up
mutual fund.
