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Informist, Wednesday, Oct. 8, 2025

 

--SEBI issues consultation paper on administration of stock exchanges 

--SEBI issues consultation paper on reducing compliance burden on exchanges 

--SEBI issues consultation paper to simplify exchanges regulatory norms 

 

MUMBAI – The Securities and Exchange Board of India has issued a consultation paper over ease of doing business for stock exchanges. The aim is to simplify regulatory requirements, remove redundant provisions, discontinue duplication, and reduce the compliance burden on exchanges, the regulator said in the paper. Public comments about the matter should be submitted by Oct. 29.

 

SEBI has proposed that the quarterly exceptional report about unfit shareholders to be submitted to the regulatory oversight committee of the stock exchanges. As per the Master Circular for Stock Exchanges and Clearing Corp., 2024, it is mandatory for stock exchanges to submit the exceptional report to SEBI about shareholders who are not fit and necessary actions taken thereof. The proposal, if implemented, will reduce the cost of compliance for bourses. 

 

It is also proposed to tweak the minimum annual trading turnover criteria for an exchange to INR 10 billion or "such other higher amount as may be decided by SEBI from time to time". Under the current norm, a stock exchange can apply for voluntary surrender of recognition if they fail to meet the minimum annual turnover or SEBI can proceed with compulsory exit of the exchange. The tweak was proposed as there has been a considerable increase in trading turnover across exchanges since 2012 when the threshold of INR 10 billion was prescribed.

 

The market regulator has also recommended to discontinue the requirement of stock exchanges transfering 1% of their security deposit to SEBI's investor protection and education fund. It also proposed to modify the norms pertaining to action plan of exclusively listed companies which are yet to indicate their intention to comply with listing or to provide exit. SEBI has proposed such companies to submit the action plan to the stock exchanges within three months of moving to dissemination board. The existing norms are silent about the timeline to submit such action plans and creates uncertainty for shareholders, SEBI said in the consultation paper. 

 

 

Stock exchanges have proposed to merge their investor protection fund for equity as well as commodity segments and constitute a single investor protection fund, SEBI said in the paper. The bourses cited reasons such as identical objective of the funds, single regulator for both stock and commodity derivatives exchanges, single membership of brokers in both equity and commodity segments, greater operational efficiency, and enhanced governance for this proposal.  End

 

Reported by Anjana Therese Antony

Edited by Akul Nishant Akhoury

 

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