SEBI Board Meet On Monday: Decisions Likely On FPI Rules, Settlement For Brokers In Algo Case And More

The first board meeting under the newly appointed SEBI Chairperson Tuhin Kanta Pandey is scheduled for Monday and several big-ticket matters are expected to be discussed.

These include easing disclosures norms for foreign portfolio investors, introducing a settlement scheme for brokers under fire for being linked to unregulated algorithmic trading platforms, extension of fee collection period for research analysts to one year, and more.

On Jan. 10 this year, SEBI suggested increasing the threshold for compulsory disclosures by foreign portfolio investors from Rs 25,000 crore to Rs 50,000 crore. This was proposed due to increased market liquidity.

Whereas on the front of brokers and their association with unregulated algo platforms, SEBI came out with a show-cause notice against 120 stock brokers last year. As NDTV Profit had exclusively reported, these brokers are likely to take up a collective settlement scheme. As per the people in the know, the scheme will be taken up for discussion in the board meet.

Furthermore, On Feb. 12, SEBI proposed to allow investment advisors and research analysts to charge advance from their clients for a period not exceeding one year. This was aimed at dealing with the liquidity issues that the professionals might face and is likely to be discussed on Monday.

The regulator may also discuss and approve stronger measures for ESG rating providers to deal with rating withdrawals, disclosures, audits and government norms.

As per the persons in the know, the measures to make clearing corporations independent from their parent exchanges could also come up for discussion in the board meeting. However, it is possible that instead of a complete demerger, only the ownership percentage of the exchanges on the clearing entities would be capped.

Meanwhile, in an attempt to protect investors and their trading accounts from unauthorised access, identity theft, SIM spoofing, OTP frauds and account modifications, the markets regulator had proposed to put a UPI-like one device-one SIM authentication system in place on Feb. 18. This is likely to be approved in the upcoming meet.

The board may also take up amendments to regulations for Infrastructure Investment Trusts and Real Estate Investment Trusts. Their core purposes are to streamline existing regulations, particularly concerning preferential issues, follow-on public offers, and pricing mechanisms.

Another proposal that is likely to be taken up is for qualified institutional buyers to include accredited investors for angel funds. This would allow angel funds to raise money from more investors, beyond the 200-investor cap set by the Companies Act for private placements.

Meanwhile, the SEBI board is also expected to discuss the market regulator's budget for the financial year 2025-26, the sources said.