{"id":310190,"date":"2025-11-22T03:10:32","date_gmt":"2025-11-22T03:10:32","guid":{"rendered":"https:\/\/peraltafinancing.com\/uncategorized\/major-misses-in-sebis-regulations-on-regulation-making-procedure\/"},"modified":"2025-11-22T03:10:32","modified_gmt":"2025-11-22T03:10:32","slug":"major-misses-in-sebis-regulations-on-regulation-making-procedure","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=310190","title":{"rendered":"Major Misses in SEBIs Regulations on Regulation Making Procedure"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div xmlns:default=\"http:\/\/www.w3.org\/2000\/svg\">\n<div data-breakout=\"normal\">\n<div class=\"yIaPa\" id=\"viewer-0l4vw338\">\n<div class=\"j6j2T j72Xt\">\n<figure class=\"Berpf\" data-hook=\"figure-IMAGE\">\n<div data-hook=\"image-viewer\" class=\"-Jv3q\">\n<div style=\"--dim-height:3333;--dim-width:4993;--ricos-image-default-border-color:unset\" id=\"0l4vw338\" class=\"qgjoK el5fm o2n-a\" data-hook=\"image-viewer-0l4vw338\"><wow-image id=\"11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg\" class=\"undefined F5cHb\" data-image-info=\"{&quot;containerId&quot;:&quot;0l4vw338&quot;,&quot;alignType&quot;:&quot;center&quot;,&quot;displayMode&quot;:&quot;fill&quot;,&quot;isLQIP&quot;:true,&quot;isSEOBot&quot;:false,&quot;lqipTransition&quot;:&quot;blur&quot;,&quot;encoding&quot;:&quot;AVIF&quot;,&quot;imageData&quot;:{&quot;width&quot;:4993,&quot;height&quot;:3333,&quot;uri&quot;:&quot;11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg&quot;,&quot;name&quot;:&quot;&quot;,&quot;displayMode&quot;:&quot;fill&quot;}}\" data-motion-part=\"BG_IMG 0l4vw338\" data-bg-effect-name=\"\" data-has-ssr-src=\"https:\/\/www.thesecuritiesblawg.in\/post\/true\" data-animate-blur=\"\" data-is-responsive=\"https:\/\/www.thesecuritiesblawg.in\/post\/true\"><img decoding=\"async\" src=\"https:\/\/static.wixstatic.com\/media\/11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg\/v1\/fill\/w_147,h_98,al_c,q_80,usm_0.66_1.00_0.01,blur_2,enc_avif,quality_auto\/11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg\" alt=\"ree\" style=\"width:100%;height:100%;object-fit:cover;object-position:50% 50%;max-width:100%\" data-pin-url=\"https:\/\/www.thesecuritiesblawg.in\/post\/major-misses-in-sebis-regulations-on-regulation-making-procedure\" data-pin-media=\"https:\/\/static.wixstatic.com\/media\/11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg\/v1\/fill\/w_4993,h_3333,al_c,q_90\/11062b_02e9f98430084085b3514d6896ef31fe~mv2.jpg\" draggable=\"false\"\/><\/wow-image><\/div>\n<p><button class=\"wwXRO\" type=\"button\" data-hook=\"image-expand-button\" aria-label=\"Expand image\"><default:svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewbox=\"0 0 19 19\" class=\"pRguY\"><default:path d=\"M15.071 8.371V4.585l-4.355 4.356a.2.2 0 0 1-.283 0l-.374-.374a.2.2 0 0 1 0-.283l4.356-4.355h-3.786a.2.2 0 0 1-.2-.2V3.2c0-.11.09-.2.2-.2H16v5.371a.2.2 0 0 1-.2.2h-.529a.2.2 0 0 1-.2-.2zm-6.5 6.9v.529a.2.2 0 0 1-.2.2H3v-5.371c0-.11.09-.2.2-.2h.529c.11 0 .2.09.2.2v3.786l4.355-4.356a.2.2 0 0 1 .283 0l.374.374a.2.2 0 0 1 0 .283L4.585 15.07h3.786c.11 0 .2.09.2.2z\" fill=\"#000\" fill-rule=\"nonzero\"\/><\/default:svg><\/button><\/div>\n<\/figure>\n<\/div>\n<\/div>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G Lyk5M sDlj2\" dir=\"auto\" id=\"viewer-bgpp6341\"><span class=\"GnvzP\"><span style=\"color:rgb(51, 51, 51);background-color:rgb(255, 255, 255);text-decoration:inherit\"><span>All\/any views expressed herein belong solely to the author and do not reflect the view\/opinions of any organisation.<\/span><\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-rq46x10551\"><span class=\"GnvzP _-7vPo\"><span>On February 13, 2025, SEBI issued the SEBI (Procedure for Making, Amending and Reviewing of Regulations) Regulations, 2025 (\u201c<\/span><strong style=\"font-weight:700\"><span>Regulation Making Procedure Regulations<\/span><\/strong><span>\u201d or \u201c<\/span><strong style=\"font-weight:700\"><span>RMP Regulations<\/span><\/strong><span>\u201d). It specifies the process of regulation making and for mandating public consultation and engagement of stakeholders in the interest of transparency and for matters incidental to or connected therewith.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-7flzv353\"><span class=\"GnvzP _-7vPo\"><span>It may be noted that SEBI has the power to make regulations consistent with and to carry out the purposes of the Securities and Exchange Board of India Act, 1992, the Securities Contracts (Regulation) Act, ,1956 and the Depositories Act, 1996.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-zbmt2355\"><span class=\"GnvzP _-7vPo\"><span>Originally, SEBI could only make regulations with the prior approval of the Central Government. This requirement was then dispensed with in 1995. However, every regulation has to be laid before both houses of the Parliament, as soon as possible after it is made, for 30 days. The Parliament can modify or invalidate the regulations so made, without prejudice to the validity of anything previously done under such regulations.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-tqx5u357\"><span class=\"GnvzP _-7vPo\"><span>SEBI&#8217;s authority to formulate regulations is essentially a legislative power delegated by the Parliament to its unelected officials. Therefore, it is crucial to ensure that appropriate checks and balances are in place in the processes. The RMP Regulations is the first attempt by SEBI to <\/span><em style=\"font-style:italic\"><span>codify<\/span><\/em><span> its procedure for making regulations, and this blogpost analyses the same.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-cxywc361\"><span class=\"GnvzP _-7vPo\"><span>The 1st\u00a0part summarizes the provisions of the RMP Regulations. The 2nd\u00a0part compares it with procedures required to be followed by the Insolvency and Bankruptcy Board of India (\u201c<\/span><strong style=\"font-weight:700\"><span>IBBI<\/span><\/strong><span>\u201d), the US Securities and Exchange Commission (\u201c<\/span><strong style=\"font-weight:700\"><span>SEC<\/span><\/strong><span>\u201d) and the UK Financial Conduct Authority (\u201c<\/span><strong style=\"font-weight:700\"><span>FCA<\/span><\/strong><span>\u201d). The 3rd\u00a0part analyses the hits and misses.<\/span><\/span><\/p>\n<\/div>\n<p><h2 class=\"bk4bG b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-77jgf369\"><span class=\"Tcz9z\"><span>Regulation Making Procedure Regulations<\/span><\/span><\/h2>\n<\/p>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-7lmlm371\"><span class=\"Tcz9z\"><span>Public Consultation<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-1xbe1373\"><span class=\"GnvzP _-7vPo\"><span>Primarily, Regulation 4 mandates publication of particulars such as (a) proposal(s) containing suggested changes to the policy, including the draft of the proposed regulations; (b) statutory provisions enabling the proposed regulations; (c) statement of regulatory intent and objectives of the proposed regulations; and (d) manner, process and timelines for receiving public comments. It also requires that minimum 21 calendar days is provided for receiving public comments. Concerned departments are required to publish the rationale for rejection if any, of comments.<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-sonb6375\"><span class=\"Tcz9z\"><span>Approval of Regulations<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-xeg4f377\"><span class=\"GnvzP _-7vPo\"><span>Prior to approving the regulations, SEBI has to consider the proposed regulations and the related agenda paper in terms of the SEBI (Procedure for Board Meetings) Regulations, 2001. If the agenda paper is prepared pursuant to the public consultation, it must include a systematic compilation of the comments received or a summary of the comments, and the remarks of the concerned department(s).<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-0lbqh379\"><span class=\"Tcz9z\"><span>Emergency Regulations<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-5d76e381\"><span class=\"GnvzP _-7vPo\"><span>When SEBI is of the opinion that it is expedient in the interest of the investors and the regulation and development of the securities market that the adherence to the public consultation process would defeat the purpose of the proposed regulation, the <\/span><strong style=\"font-weight:700\"><span>Chairperson <\/span><\/strong><span>may dispense with the process of public consultation or reduce the time period for receiving public comments.<\/span><strong style=\"font-weight:700\"><span>\u00a0<\/span><\/strong><span>When such dispensation has been used, the information in its regard must be placed before the Board.<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-jjbjg387\"><span class=\"Tcz9z\"><span>Periodic review of Regulations<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-hb7l1389\"><span class=\"GnvzP _-7vPo\"><span>The RMP Regulations have introduced the requirement for SEBI to periodically review the regulations in force, keeping in view factors including experience gained through surveillance, supervision and enforcement actions; relevant orders passed by the courts or tribunals; global best practices, if applicable; relevance and needs of a changed environment, if any; and scope for reducing redundancies and to promote ease of doing business. It can also do so for any other factor deemed to be relevant by the board.<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-zef92391\"><span class=\"Tcz9z\"><span>Scope of the RMP Regulations<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-92b0m393\"><span class=\"GnvzP _-7vPo\"><span>Certain instances have been exempted from above discussed procedures. These are<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<ul class=\"_4ZJKX KVAVd\">\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:disc\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-c92t7395\"><span class=\"GnvzP _-7vPo\"><span>Internal organizational matters of SEBI including those governing the conduct of its meetings, administration and service conditions of its officers and employees;<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:disc\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-t9tet397\"><span class=\"GnvzP _-7vPo\"><span>Regulations only related to procedural requirements or which in the opinion of the <\/span><strong style=\"font-weight:700\"><em style=\"font-style:italic\"><span>Chairperson <\/span><\/em><\/strong><span>do not result in any substantive policy changes;<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:disc\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-m7kii401\"><span class=\"GnvzP _-7vPo\"><span>Any amendment to these regulations; and<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:disc\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-9vqyy403\"><span class=\"GnvzP _-7vPo\"><span>Proposals for which the public comments have already been sought or received or those regulations which are approved by SEBI but not yet notified prior to coming into force of these regulations.<\/span><\/span><\/p>\n<\/li>\n<\/ul>\n<\/div>\n<p><h2 class=\"bk4bG b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-70w8w405\"><span class=\"Tcz9z\"><span>Comparative Analysis<\/span><\/span><\/h2>\n<\/p>\n<p><h3 class=\"Njwtn b3yOZ _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-u0mrl407\"><span class=\"Tcz9z _-7vPo\"><span>IBBI (Mechanism for Issuing Regulations) Regulations, 2018<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-z9ub7409\"><span class=\"GnvzP _-7vPo\"><span>A comparison of the RMP Regulation with the IBBI (Mechanism for Issuing Regulations) Regulations, 2018 (\u201c<\/span><strong style=\"font-weight:700\"><span>IBBI Regulations<\/span><\/strong><span>\u201d) stresses the deficiencies in SEBI\u2019s regulations. IBBI Regulations mandate IBBI to provide an economic analysis of the proposed regulations. It also provides that if the Governing Board decides to approve regulations in a form substantially different from the proposed regulations, it shall repeat the process under these regulations.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-tvbcu413\"><span class=\"GnvzP _-7vPo\"><span>Specifically, the IBBI is required to cause an economic analysis of the proposed regulations to be made. This economic analysis is required to cover expected costs\u00a0 to be incurred by, and the benefits that will accrue to, the society, economy, stakeholders and to IBBI, both directly and indirectly on account of the proposed regulation; and how the proposed regulations further strengthen the objectives of IBC.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-jd7wx415\"><span class=\"GnvzP _-7vPo\"><span>Moreover, the urgent regulation making powers also must be noted. Where there is a need to make or amend regulations urgently, i.e., by dispensing with public consultation and economic analysis, it requires the approval of governing board. Further, the periodic review is every 3 years unless warranted earlier. Moreover, the regulations also included <\/span><u style=\"text-decoration:underline\"><span>outcome<\/span><\/u><span> as a factor for review.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-h18ul419\"><span class=\"GnvzP _-7vPo\"><span>The IBBI Regulations also expressly provided that IBBI may consult stakeholders and advisory committees, as it may consider appropriate for making regulations.<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-bszrw421\"><span class=\"Tcz9z\"><span>UK &#8211; Financial Services Act, 2012<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-1pud1423\"><span class=\"GnvzP _-7vPo\"><span>The Financial Services Act, 2012 of UK has also laid down detailed processes that the FCA is required to carry out towards making regulations. It provides that:<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo K2IUf\" dir=\"auto\" id=\"viewer-7lx6n425\"><span class=\"GnvzP _-7vPo\"><span style=\"color:rgb(0, 95, 95);text-decoration:inherit\"><span>\u00d8\u00a0 <\/span><\/span><span>FCA must publish a draft for public consultation after consultation with the Prudential Regulation Authority. Such draft is required to be accompanied by cost benefit analysis, explanation of the purpose of the proposed rules, explanations of the FCA\u2019s reasons for believing that making the proposed rules is compatible with its duties under the law as well as a notice containing the timeline for submission of representations.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo K2IUf\" dir=\"auto\" id=\"viewer-mxiua428\"><span class=\"GnvzP _-7vPo\"><span style=\"color:rgb(0, 95, 95);text-decoration:inherit\"><span>\u00d8\u00a0 <\/span><\/span><span>Thereafter, the FCA has to have regard to the representations made to it, it has to publish an account of its response to the represents made if it makes the proposed rules.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo K2IUf\" dir=\"auto\" id=\"viewer-a6nu4431\"><span class=\"GnvzP _-7vPo\"><span style=\"color:rgb(0, 95, 95);text-decoration:inherit\"><span>\u00d8\u00a0 <\/span><\/span><span>If the rules differ from the draft published, in a way which is significant, in the opinion of FCA, it must publish details of the differences together with cost benefit.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-e7n59434\"><span class=\"GnvzP _-7vPo\"><span>If the costs or benefits cannot be reasonably estimated, or it is not reasonably practicable to produce an estimate the FCA is not required to estimate them, but it is required to include a statement of FCA\u2019s opinion and an explanation of it.<\/span><\/span><\/p>\n<\/div>\n<p><h3 class=\"Njwtn b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-c9d3y436\"><span class=\"Tcz9z\"><span>US SEC<\/span><\/span><\/h3>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-7g65h438\"><span class=\"GnvzP _-7vPo\"><span>The US SEC is also required to engage in some form of cost benefit analysis in terms of the National Securities Market Improvement Act, 1996 and the Securities Exchange Act.<\/span><a target=\"_blank\" href=\"#_ftn1\" rel=\"noopener\" class=\"Y2xcL uFqDN\" data-hook=\"web-link\"><span style=\"color:rgb(38, 38, 38);text-decoration:inherit\"><span>[1]<\/span><\/span><\/a><span>\u00a0In US these seemingly procedural requirements have become basis for litigants, for instance to challenge whether the SEC adequately assessed the economic consequences of a rule.<\/span><a target=\"_blank\" href=\"#_ftn2\" rel=\"noopener\" class=\"Y2xcL uFqDN\" data-hook=\"web-link\"><span style=\"color:rgb(38, 38, 38);text-decoration:inherit\"><span>[2]<\/span><\/span><\/a><\/span><\/p>\n<\/div>\n<p><h2 class=\"bk4bG b3yOZ KVAVd sDlj2\" dir=\"auto\" id=\"viewer-9h9ev443\"><span class=\"Tcz9z\"><span>Major Misses<\/span><\/span><\/h2>\n<\/p>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-dq4fo445\"><span class=\"GnvzP _-7vPo\"><span>A plain reading of the provisions of the Regulations highlights a major issue &#8211; the determination of when it is okay to dispense with public consultation or reducing time period for the same has been vested with the Chairperson instead of the governing board. Similarly, the determination of whether a particular regulation results in substantive policy change or not has also been left with the Chairperson.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-ltgjc447\"><span class=\"GnvzP _-7vPo\"><span>A comparative analysis of the Regulations with IBBI \u00a0two key misses \u2013 (1) absence of requirement for economic analysis prior to public consultation; and (2) no timeline for periodic review of regulation. This comparison also emphasizes the authority which must be vested with the discretionary powers discussed in the preceding paragraph.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-ef1el449\"><span class=\"GnvzP _-7vPo\"><span>It appears these regulations primarily formalize existing regulatory practices, rather than introducing any substantive reform therein. Mandating public consultation and periodic review, though a stride, is just not big enough. In essence, it offers limited accountability for SEBI, which may not be commensurate with the fact that it is exercising delegated legislative powers, and their implementation appears somewhat unstructured.<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-57cda451\"><span class=\"GnvzP _-7vPo\"><span>Summarizing, following things if done differently would have made this a valuable regulation:<\/span><\/span><\/p>\n<\/div>\n<div data-breakout=\"normal\">\n<ol class=\"erjqb KVAVd\">\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:decimal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-7xxfs453\"><span class=\"GnvzP _-7vPo\"><span>In light of the principles of separation of powers enshrined by <\/span><a target=\"_blank\" href=\"https:\/\/dea.gov.in\/sites\/default\/files\/fslrc_report_vol1_1.pdf\" rel=\"noopener noreferrer\" class=\"Y2xcL uFqDN\" data-hook=\"web-link\"><u style=\"text-decoration:underline\"><span>the Financial Sector Legislative Reforms Committee<\/span><\/u><\/a><span>, the decisions vested with the Chairperson, would be ideal if vested with the governing board of SEBI, if at all they ought to be provided.<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:decimal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-fcv50455\"><span class=\"GnvzP _-7vPo\"><span>The urgency provision needs more safeguards. It, i.e., Regulation 6 indicates that the chairperson can dispense the process of public consultation or reduce the time period for it, where the Board is of the opinion that it is expedient in the interest of investors\u2026. Proviso requires the information regarding this to be placed before the Board. <\/span><\/span><\/p>\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-jkkhh16031\"><span class=\"GnvzP _-7vPo\"><span>This language needs clarity and the governing board should have more than just the role of being informed of the use of such dispensation.<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:decimal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-7byfq457\"><span class=\"GnvzP _-7vPo\"><span>Incorporation of economic\/cost benefit analysis prior to public consultation, as well as post, in case of substantial modification to the originally proposed regulation.<\/span><\/span><\/p>\n<\/li>\n<li dir=\"auto\" aria-level=\"1\" class=\"qUi3b\" style=\"text-align:JUSTIFY;margin-inline-start:1.5em;list-style-type:decimal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"\" id=\"viewer-f7wui459\"><span class=\"GnvzP _-7vPo\"><span>Specified timeline for periodic review of regulations \u2013 3 years like IBBI, except in case of frequently amended regulations.<\/span><\/span><\/p>\n<\/li>\n<\/ol>\n<\/div>\n<div data-breakout=\"normal\">\n<p class=\"IFLJx f1-1G _-7vPo sDlj2\" dir=\"auto\" id=\"viewer-knupl461\"><span class=\"GnvzP _-7vPo\"><span>Last but not the least, SEBI has created multiple types of legal instruments \u2013 pertinently circulars and master circulars, neither of which face any legislative oversight or judicial review.<\/span><a target=\"_blank\" href=\"#_ftn3\" rel=\"noopener\" class=\"Y2xcL uFqDN\" data-hook=\"web-link\"><span style=\"color:rgb(38, 38, 38);text-decoration:inherit\"><span>[3]<\/span><\/span><\/a><span>\u00a0The procedure for making of these also (especially) ought to have been laid out. In an article, <\/span><em style=\"font-style:italic\"><span>Shubho Roy<\/span><\/em><span> et al had premised that public choice theory predicts that the staff of SEBI will prefer instruments having no parliamentary oversight,<\/span><a target=\"_blank\" href=\"#_ftn4\" rel=\"noopener\" class=\"Y2xcL uFqDN\" data-hook=\"web-link\"><span style=\"color:rgb(38, 38, 38);text-decoration:inherit\"><span>[4]<\/span><\/span><\/a><span> and this is true if we take into account that around 400 circulars have been issued in the previous 3 years.<\/span><\/span><\/p>\n<\/div>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>All\/any views expressed herein belong solely to the author and do not reflect the view\/opinions of any organisation. On February 13, 2025, SEBI issued the SEBI (Procedure for Making, Amending and Reviewing of Regulations) Regulations, 2025 (\u201cRegulation Making Procedure Regulations\u201d or \u201cRMP Regulations\u201d). It specifies the process of regulation making and for mandating public consultation [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":310191,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[97445],"tags":[11278,2167,22071,31658,17012,26136,140359],"dealstore":[],"offerexpiration":[],"class_list":["post-310190","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-editorial","tag-major","tag-making","tag-misses","tag-procedure","tag-regulation","tag-regulations","tag-sebis"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Major Misses in SEBIs Regulations on Regulation Making Procedure - Som2ny Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fivemor.com\/?p=310190\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Major Misses in SEBIs Regulations on Regulation Making Procedure - Som2ny Network\" \/>\n<meta property=\"og:description\" content=\"All\/any views expressed herein belong solely to the author and do not reflect the view\/opinions of any organisation. 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