Daily English Quiz™

The newly introduced Securities Markets Code, 2025 (SMC 2025) aims to consolidate and simplify India’s securities market regulations by replacing three existing laws the Securities Contracts (Regulation) Act, 1956; the Securities and Exchange Board of India (Sebi) Act, 1992; and the Depositories Act, 1996. These laws collectively govern securities trading, dematerialised holding of securities, and the functioning of Sebi and the Securities Appellate Tribunal (SAT). The Code has been referred to the Parliamentary Standing Committee on Finance for detailed examination. While most existing provisions have been retained, the Code introduces significant changes, particularly regarding the composition and powers of Sebi. The board size is proposed to increase from nine to fifteen members, with up to six being independent, part-time members. This change is intended to bring broader expertise and external perspectives. Additionally, the Code expands the definition of conflict of interest to include not only direct and indirect interests of Sebi members but also those of their family members. The central government is empowered to remove any member whose interests may adversely affect Sebi’s functioning. The SMC restricts the appointment of investigating or adjudicating officers to whole-time Sebi members or Sebi officers, unlike the current framework where any person could be appointed. To ensure fairness, adjudicators are barred from handling cases in which they were previously involved as investigators. For the sake of certainty and closure, the Code introduces an eight-year limitation period for investigations from the date of the alleged offence. However, this limit does not apply to cases having a systemic market impact or those referred by investigating agencies. In terms of penalties, the Code marks a shift by removing imprisonment for certain contraventions, retaining monetary penalties instead. Imprisonment is reserved for serious offences such as non-compliance with regulatory orders and major market abuses including insider trading, investor fraud, misuse of non-public information, and price manipulation. Notably, the Code proposes to include market abuse under the Prevention of Money Laundering Act (PMLA), thereby enabling investigations by the Enforcement Directorate. The Code also formally recognises Market Infrastructure Institutions (MIIs) such as stock exchanges, clearing corporations, and depositories, along with any new categories notified by the Centre. MIIs are permitted to frame bye-laws to ensure fair access, reduce market abuse, and promote interoperability. Sebi is authorised to delegate certain registration functions to MIIs. Furthermore, the Code strengthens investor protection by mandating investor grievance redress mechanisms, empowering Sebi to appoint an ombudsperson, and introducing an investor charter. Overall, the consolidation is expected to simplify securities market regulation and offers a broader and more robust definition of conflict of interest. However, concerns remain that the Code grants extensive powers to Sebi, making a clearer framework of checks and balances essential to ensure continued accountability of the regulator.

😍 Ready For Next Reading Comprehension My Warriors ? 🏆 READING COMPREHENSION SET - 148

🏆RBI Upcoming Vacancies Update :- 🔜Notification Expected : Within 1 Month. 🏛RBI Assistant :- ✔️Vacancies : 540+ Posts 🏛RBI Office Attendant :- ✔️Vacancies : 640+ Posts 🔛Expected Exam Month : February/March. 🧲Source : Akash Jadhav Sir🧲

😍 Share Your Score Out of 10 In Comment Section My Warriors....

Hi