In January 2022, the Securities and Exchange Board of India (SEBI) amended the SEBI (Settlement Proceedings) Regulations, 2018, called the SEBI (Settlement Proceedings) (Amendment) Regulations, 2022 and has reduced the timeline for filing settlement applications to just 60 days from the current 180 days to make the system more efficient.
- All payments under the settlement regulations will be accepted only through a dedicated payment gateway. To give this effect, the SEBI has amended Settlement Proceedings norms.
- Thus, a settlement application can be filed within 60 days of the date of receipt of the show-cause notice. An additional 120 days could be availed by the applicants in case they pay an additional 25 percent over the settlement charges.
Other Changes over the Settlement Proceedings:
i.The time period for submission of revised settlement terms form, after the internal committee (IC), has been rationalised to 15 days (from the date of the IC meeting).
- The current rule allows 10 days plus additional 20 days.
ii.Guidelines related to the procedure to be adopted for arriving at suitable terms pursuant to the filing of a compounding application also issued by SEBI.
iii.SEBI has rationalised the proceeding conversion factor (PCF) values range as 0.40 to 1.50 to encourage the filing of settlement applications during the early stages of the proceedings and to deter forum shopping.
- The current PCF values range from 0.65 to 1.20 depending upon the stage at which an application for settlement is filed.
iv.Under the settlement mechanism, an alleged offender could settle a pending case with the regulator without admission or denial of guilt by paying a settlement fee.
-SEBI Amended the FPIs norms
i.SEBI has amended SEBI (Foreign Portfolio Investors (FPI)) Regulations, 2019 called SEBI (FPI) (Amendment) Regulations, 2022 and stated that it could provide an exemption from strict enforcement of the regulations in other cases.
ii.SEBI may suo motu or on an application made by an FPI, for reasons recorded in writing, grant relaxation from the strict enforcement of any of the provisions of those regulations.
iii.This is subject to such conditions as the SEBI deems fit to impose in the interests of investors and the securities market and for the development of the securities market if SEBI is satisfied that (i) the non-compliance is caused due to factors beyond the control of the entity; or (ii) the requirement is procedural or technical in nature.
Note – Foreign Portfolio Investment (FPI) is defined as the investments made by investors in financial assets, such as stocks and bonds of entities located in another country.
Recent Related News:
In December 2021, SEBI has approved the proposal to amend various aspects of the regulatory framework under the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 (ICDR Regulations) and consequential amendment to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
About Securities and Exchange Board of India (SEBI):
Establishment – 1992
Headquarters – Mumbai, Maharashtra
Chairman – Ajay Tyagi