Securities and Exchange Board of India (SEBI) ,Objectives of SEBI, Functions of SEBI,

 

The Securities and Exchange Board of India (SEBI) :

SEBI is the regulator of Securities market of India. The main functions of SEBI is :

"...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“.It was established in the year 1988 and given statutory powers on 12 April 1992 through the SEBI Act, 1992.

Objectives of SEBI:

•         To regulate the activities of stock exchange.
•         To protect the rights of investors and ensuring safety to their investment.
•         To prevent fraudulent and malpractices by having balance between self regulation of business and its statutory regulations.
•         To regulate and develop a code of conduct for intermediaries such as brokers, underwriters, etc.

Functions of SEBI:

The SEBI performs following important functions to meet its objectives:

1. Protective functions   
2.  Developmental functions  
3. Regulatory functions.

1. Protective Functions:

These functions are performed by SEBI to protect the interest of investor and provide safety of investment.

As protective functions SEBI performs following functions:

• SEBI Checks Price Rigging:
• SEBI Prohibits Insider trading:
• SEBI prohibits fraudulent and Unfair Trade Practices
• SEBI undertakes steps to educate investors .
• SEBI promotes fair practices and code of conduct in security market

Developmental Functions:

These functions are performed by the SEBI to promote and develop activities in stock exchange and increase the business in stock exchange. Under developmental category:

• SEBI promotes training of intermediaries of the securities market, 
• SEBI tries to promote activities of stock exchange by adopting flexible and adoptable approach .

Regulatory Functions:

These functions are performed by SEBI to regulate the business in stock exchange by framing rules and regulations and a code of conduct to regulate the intermediaries such as merchant bankers, brokers, underwriters, etc.

• SEBI registers and regulates the working of various stakeholders like stock brokers, sub-brokers, share transfer agents, trustees, merchant bankers etc.
• SEBI registers and regulates the working of mutual funds etc.
• SEBI regulates takeover, merger and aquisition-of the companies. 
• SEBI conducts inquiries and audit of stock exchanges.