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Time of India
10 hours ago
- Business
- Time of India
Sebi slaps Rs 25 lakh penalty on BSE for flouting regulatory norms
Capital markets regulator Sebi on Wednesday slapped a Rs 25 lakh penalty on BSE for failing to provide equal access to corporate disclosures to all stakeholders and take action against brokers with frequent modifications during trades. The market regulator passed the order after an inspection conducted between February 2021 and September 2022. In a 45-page order, Sebi found that BSE's system architecture allowed its paid clients and internal listing compliance monitoring (LCM) team to access corporate announcements before the same were made public through its website, resulting in a breach of norms. The regulator also observed that the data dissemination process lacked safeguards to ensure simultaneous and equal access to all stakeholders, which is critical to maintaining market integrity and preventing unfair information advantage. Accordingly, Sebi concluded that BSE failed to comply with Regulation 39(3) of the Securities Contracts (Regulation) SECC (Stock Exchange and Clearing Corporations) Regulations, 2018, which mandates stock exchanges to ensure fair and transparent access to all users. Live Events It also noted that BSE did not establish a really simple syndication (RSS) feed, which could have mitigated the risk of unequal access to corporate disclosures. Although the exchange later created a time gap to address the issue, Sebi held that such corrective action was taken only after the inspection highlighted lapses. Sebi also flagged serious shortcomings in BSE's monitoring of client code modifications , which are permitted only in case of genuine errors. BSE failed to initiate disciplinary action against brokers with frequent modifications and did not adequately monitor 'error accounts', raising concerns over the possibility of misuse and lack of due diligence in trades between unrelated institutional clients. "...the role of stock exchanges as 'the first layer of oversight' is of much significance, while handling material price sensitive information about listed companies and their securities. "Therefore, as a premier recognised stock exchange, BSE must have internal controls on how to manage and handle such corporate announcements so as to ensure compliance with its obligations," Sebi's Quasi Judicial Authority Santosh Shukla said in the order. The availability of information about listed companies with LCM employees of BSE and its paid subscribers before it is available to general investors through its website has clearly impaired the concept of impartiality, transparency and fairness of information dissemination from the first level regulator BSE, Shukla said. Further, BSE has also displayed laxity and negligence, with respect to not supervising norms with regard to client code modifications as found, he added.
Time of India
11 hours ago
- Business
- Time of India
Sebi slaps Rs 25 lakh penalty on BSE for flouting regulatory norms
Capital markets regulator Sebi on Wednesday slapped a Rs 25 lakh penalty on BSE for failing to provide equal access to corporate disclosures to all stakeholders and take action against brokers with frequent modifications during trades. The market regulator passed the order after an inspection conducted between February 2021 and September 2022. In a 45-page order, Sebi found that BSE's system architecture allowed its paid clients and internal listing compliance monitoring (LCM) team to access corporate announcements before the same were made public through its website, resulting in a breach of norms. The regulator also observed that the data dissemination process lacked safeguards to ensure simultaneous and equal access to all stakeholders, which is critical to maintaining market integrity and preventing unfair information advantage. Accordingly, Sebi concluded that BSE failed to comply with Regulation 39(3) of the Securities Contracts (Regulation) SECC (Stock Exchange and Clearing Corporations) Regulations, 2018, which mandates stock exchanges to ensure fair and transparent access to all users. It also noted that BSE did not establish a really simple syndication (RSS) feed, which could have mitigated the risk of unequal access to corporate disclosures. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 5 Books Warren Buffett Wants You to Read In 2025 Blinkist: Warren Buffett's Reading List Undo Although the exchange later created a time gap to address the issue, Sebi held that such corrective action was taken only after the inspection highlighted lapses. Sebi also flagged serious shortcomings in BSE's monitoring of client code modifications, which are permitted only in case of genuine errors. BSE failed to initiate disciplinary action against brokers with frequent modifications and did not adequately monitor 'error accounts', raising concerns over the possibility of misuse and lack of due diligence in trades between unrelated institutional clients. "...the role of stock exchanges as 'the first layer of oversight' is of much significance, while handling material price sensitive information about listed companies and their securities. "Therefore, as a premier recognised stock exchange, BSE must have internal controls on how to manage and handle such corporate announcements so as to ensure compliance with its obligations," Sebi's Quasi Judicial Authority Santosh Shukla said in the order. The availability of information about listed companies with LCM employees of BSE and its paid subscribers before it is available to general investors through its website has clearly impaired the concept of impartiality, transparency and fairness of information dissemination from the first level regulator BSE, Shukla said. Further, BSE has also displayed laxity and negligence, with respect to not supervising norms with regard to client code modifications as found, he added. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
05-05-2025
- Business
- Business Standard
Sebi mandates cooling-off period for directors at market infra institutions
Markets regulator Sebi has strengthened the governance framework of market infrastructure institutions -- stock exchanges, clearing corporations and depositories -- by prescribing a mandatory cooling-off period for directors before they can join a competing institution. To give this effect, Sebi has amended Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 or SECC Regulations as well as Depositories and Participants norms 2018. In two separate notifications dated April 30, Sebi said that a non-independent director serving on the board of a market infrastructure institution will be eligible for direct appointment to the board of a competing institution after meeting two conditions -- a cooling-off period and prior approval of the appointment from the regulator. "Non-independent director on the governing board of a recognised stock exchange or a recognised clearing corporation may be appointed in another recognised stock exchange or a recognised clearing corporation or a depository with the prior approval of the Board (Sebi), only after a cooling-off period as may be specified by the governing board of such recognised stock exchange or recognised clearing corporation," Sebi said. After the expiry of the term at an MII, a public interest director can be appointed with the prior approval of Sebi for a further term of three years in another stock exchange or a clearing corporation or a depository. Sebi clarified that the cooling-off period would be applicable only in case of appointment as a public interest director in a competing market infrastructure institution (MII). The moves are aimed at strengthening governance at MIIs while safeguarding market integrity through effective cooling-off policies. This came after the board of Sebi in March reviewed the norms for appointing specific key officials of stock exchanges and other market institutions, along with a cooling-off period before they can join a competing institution. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
