Notes

1. SEBI - ...
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SEBI - ...
BA.LLB 5 years law (Karnataka State Law University)
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2. SEBI
(Securities and exchange board of India)
 The Preamble of the Securities and Exchange Board of India Act, 1992
prescribes the basic functions of the Securities and Exchange Board of India
(SEBI) as "...to protect the interests of investors in securities and to
promote the development of, and to regulate the securities market and for
matters connected therewith or incidental thereto".
 SEBI protects the interests of investors investing in securities along with
regulating the securities market. SEBI also regulates how the stock market
and mutual fund's function.
ROLE OF SEBI:
1. Market regulation:
 Regulates the functioning of stock exchanges
2. Investor protection:
 Protect the interests of investors by enforcing stringent disclosure
norms, promoting transparency, and acting against fraudulent and
manipulative practices.
3. Issuer regulation
 Regulates companies looking to raise capital through public offerings
4. Mutual fund oversight:
 Regulates and supervises mutual funds and other asset management
activities, safeguarding the interests of investors in these financial
products.
FRAMEWORK OF SEBI:
1. Investor protection:
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3.  It seeks to ensure that investors receive accurate and timely information
about the securities they invest in and are protected from fraudulent
and unfair trade practices.
2. Regulation and development of the securities market:
 It formulates regulations and guidelines that govern various market
participants, such as stock exchanges, brokers, and listed companies, to
promote fair and transparent practices.
3. Prevention of insider trading:
 SEBI's regulations on insider trading aim to maintain a level playing field
for all market participants.
4. Promotion of fair practices and code of conduct:
 It enforces a code of conduct for all market participants, fostering an
environment where market activities are conducted ethically and
transparently.
5. Prohibition of fraudulent and unfair trade practices:
 It investigates and takes corrective measures to maintain market
integrity and protect investors from market manipulators.
6. Development of a secondary market:
 SEBI plays a crucial role in the development of the secondary market by
introducing reforms and initiatives to enhance liquidity, transparency,
and efficiency in trading.
7. Organizational structure of SEBI:
 SEBI has over 20 departments, all of which are supervised by their
respective department heads, which in turn are administered by a
hierarchy in general. The regulatory body is managed by its members,
which consist of the following:
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4. i. The chairman is nominated by the Union Government of India.
ii. 2 Two members from the Union Finance Ministry.
iii. One member from the Reserve Bank of India.
iv. The remaining five members are nominated by the Union
Government of India.
 SEBI has its headquarters in Mumbai and has regional offices in New
Delhi, Kolkata, Chennai, and Ahmedabad, along with local offices in
Jaipur and Bangalore, and offices at Guwahati, Bhubaneshwar, Patna,
Kochi, and Chandigarh.
SEBI (LORD)
 The Securities and Exchange Board of India (SEBI) introduced the Listing
Obligations and Disclosure Requirements (LODR) mandate to streamline
and strengthen corporate governance practices among listed entities.
 Ensure transparency in business operations.
 Promote better corporate governance.
 Protect the interests of investors by enforcing timely disclosures.
 Standardize disclosure requirements for listed entities.
 The LODR mandate covers a wide range of areas, including financial
reporting, board composition, shareholder rights, and the disclosure of
material events.
INVESTMENT BANKER:
 An investment banker is a person who often operates as part of a financial
institution and who is concerned primarily with raising capital for
companies, governments, or other organizations.
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5.  The issuance of shares includes the development of comprehensive
Securities and Exchange Commission (SEC) documents, which is required
for a business to go public.
 An investment banker also helps with pricing financial instruments and
regulatory requirements to meet.
STOCK EXCHANGE:
 Stock Exchange market is a vital component of a stock market. It facilitates
the transaction between traders of financial instruments and targeted
buyers
 It is a platform where buyers and sellers come together to trade financial
tools during specific hours of any business day while adhering to SEBI’s
well-defined guidelines. However, only those companies who are listed in a
stock exchange are allowed to trade in it.
 A stock exchange in India adheres to a set of rules and regulations directed
by Securities and Exchange Board of India or SEBI. The said authoritative
body functions to protect the interest of investors and aims to promote the
stock market of India.
DEPOSITORY:
 A depository is an organization that holds your securities (shares,
debentures, bonds, government securities, etc.) in electronic form through
a registered depository participant. These institutions play a crucial role in
the functioning of financial markets by facilitating the efficient transfer and
settlement of securities transactions.
 Depositories also facilitate various corporate actions, such as dividends,
bonus issues, rights offerings and mergers. They ensure seamless
communication between issuers, investors and other market participants.
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