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SEBI AND ITS ROLE AS
REGULATOR
CA PRATAP VISHNOI
OUTLINE
 CONSTITUTION AND ORGANISATION
 OBJECTIVES
 FUNCTIONS
 PERFORMANCE
CONSTITUTION AND REGULATION
THE SEBI WAS ESTABLISHED ON APRIL 12,1988
THROUGH AN ADMINISTRATIVE ORDER, BUT IT
BECAME
A
STATUTORY
AND
REALLY
POWERFUL ORGANIZATION ONLY SINCE 1992.
SEBI is a body of six members comprising the chairman,
two members from amongst the officials of the ministers
of central government dealing with Finance and Law.
Two members who are professional and have experience or
special knowledge relating to securities market.
One member from RBI.
OBJECTIVES:
 To protect the interest of investors in securities.
 To promote the development of, and to regulate the
securities market and for matters connected therewith or
incidental thereto.
 To protects the Rights and interests of investors,
particularly individual investors.
 To prevents trading malpractices and aims at achieving a
balance between self-regulation by securities industry and
its statutory regulation.
 To facilitating an efficient mobilization and allocation of
resources through the securities markets, stimulating
competition, and encouraging innovations.
FUNCTIONS:
 TO REGULATE:
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Depositories and Participants.
Custodians.
Debenture trustees, and Trust deeds.
FIIs.
Insider trading.
Merchant bankers
Mutual Funds.
Port folio managers and investment advisors.
Registrars to issue and share transfer agents.
Venture capital funds.
PERFORMANCE:
 PPRIMARY SECURITIES MARKET
 SECONDARY MARKET AND INTERMEDIARRIES
 MUTUAL FUNDS
 MISCELLANEOUS
 INVESTOR PROTECTION MEASURES
Functions of SEBI in Respect of
Matters specified in Section 11 of
the SEBI Act, 1992:
 Violation of advertisement code/Guidelines .
 Delay in submission of periodical reports.
 Inadvertent short-selling.
 Failure to install systems and compliance
mechanism in place.
 Discrepancies in calculation of annualized
returns in draft offer document.