25919924-Sebi-Final - SEBI – SECURITIES AND EXCHANGE...

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Unformatted text preview: SEBI – SECURITIES AND EXCHANGE BOARD OF INDIA EXCHANGE What is sebi ? • SEBI : Securities and Exchange Board of India The Securities and Exchange Board of India was established on April 12, 1992 in accordance with the provisions of the Securities and Exchange Board of India Act , 1992. Organization Details Headquarters Established Jurisdiction Head Chairman Term Total Staff Mumbai, India 1992 India Chairman CB Bhave February 16, 2008 525 Official Website Website www.sebi.gov.in Objectives of SEBI Objectives • Securities & Exchange Board of India (SEBI) formed of under the SEBI Act, 1992 with the prime objective of – Protecting the interests of investors in securities, – Makes rules and regulations for the securities market. – It tries to develop the securities market. Focus being the greater investor protection, SEBI has become a vigilant watchdog become FUNCTIONS OF SEBI FUNCTIONS A) Registration And Regulation Of The Working Of A) Intermediaries Intermediaries Primary Market Merchant Bankers Underwriters Portfolio Managers Portfolio Secondary Market Stock brokers Sub- Brokers •regulates the working of the depositories [participants], custodians of securities, foreign institutional investors, credit rating agencies and such other intermediaries FUNCTIONS OF SEBI FUNCTIONS B) Registration And Regulation Of Mutual Funds, Venture B) Capital Funds & Collective Investment Schemes Every mutual fund must be registered with SEBI and registration is Every granted only where SEBI is satisfied with the background of the fund. SEBI has the authority to inspect the books of accounts, records and SEBI documents of a mutual fund, its trustees, AMC and custodian where it deems it necessary it • Every new scheme launched by a mutual fund needs to be filed with SEBI Every and SEBI reviews the document in regard to the disclosures contained in such documents. such Regulations have been laid down regarding listing of funds, refund Regulations procedures, transfer procedures, disclosures, guaranteeing returns etc procedures, SEBI has also laid down advertisement code to be followed by a mutual SEBI fund in making any publicity regarding a scheme and its performance fund SEBI has prescribed norms / restrictions for investment management with SEBI a view to minimize / reduce undue investment risks. view SEBI also has the authority to initiate penal actions against an erring MF. SEBI In case of a change in the controlling interest of an asset management In company, investors should be given at least 30 days time to exercise their exit option. exit • • • • • FUNCTIONS OF SEBI FUNCTIONS C) Prohibiting Fraudulent And Unfair Trade Practices In The Securities Market The – SEBI is vested with powers to take action against these SEBI practices relating to securities market manipulation and misleading statements to induce sale/purchase of securities. FUNCTIONS OF SEBI FUNCTIONS D] Prohibition Of Insider Trading – Stock Watch System, which has been put in place, surveillance Stock over insider trading would be further strengthened. over E] Investor Education And The Training Of Intermediaries E] – SEBI distributed the booklet titled “A Quick Reference Guide for SEBI Investors” to the investors Investors” – SEBI also issued a series of advertisement /public notices in national as well as regional newspapers to educate and caution the investors about the risks associated with the investments in collective investment schemes schemes – SEBI has also issued messages in the interest of investors on National SEBI Channel and Regional Stations on Doordarshan. Channel FUNCTIONS OF SEBI FUNCTIONS F) G) G) H) Inspection And Inquiries Regulating Acquisition Of Shares And Take-overs Regulating Conducting Research For The Above Purposes Powers Of Sebi • Can ask any intermediary or market participant for information • Inspect books of depository participants , issuers or beneficiary owners . • Suspend or cancel registration issued to foreign institutional investors • Suspend or cancel the registration of errant portfolio managers . VETTING BY SEBI VETTING • A company cannot come out with public issue unless Draft Prospectus is filed company with SEBI. Prospectus is a document by way of which the investor gets all the information pertaining to the company in which they are going to invest. It gives the detailed information about the Company, Promoter / Directors, group companies, Capital Structure, Terms of the present issue etc. Capital • A company cannot file prospectus directly with SEBI. It has to be filed through a merchant banker. After the preparation of prospectus, the merchant banker along with the due diligence certificates and other compliances and sends the same to SEBI for Vetting. SEBI • SEBI on receiving the same scrutinizes it and may suggest changes within 21 days SEBI of receipt of prospectus • The company can come out with a public issue any time within 180 days from the The date of the letter from SEBI or if no letter is received from SEBI, within 180 days from the date of expiry of 21 days of submission of prospectus with SEBI • If the issue size is upto Rs. 20 crores then the merchant bankers are required to file If prospectus with the regional office of SEBI falling under the jurisdiction in which registered office of the company is situated. ? If the issue size is more than Rs. 20 crores, merchant bankers are required to file If prospectus at SEBI, Mumbai office. SEBI Guidelines- FOR INVESTORS • Guidelines for new issues made by new companies • New issues made by Private Ltd Companies • Public issues by existing listed companies • Listing of shares on the O.T.C. • Underwriting is optional if the issue is made to the public and should not include reserved or preferential quota or employee’s quota • • • • • Composite issues New financial instruments Reservation in issues Deployment of issue proceeds Lock in period SEBI Guidelines- To Investors • Deal with a registered member of the stock exchange • Deals to be done in trading ring • Give specific orders to buy or sell within fixed price limits • Contract notes to be passed • Deal to be registered with the stock exchange in Block Book • Collect a settlement table from the stock exchange • Keep separate record of dealings • Execute periodic settlements of dues and delivery of shares • Insist on delivery ...
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