New Delhi: Aiming to deepen capital markets, regulator Sebi Friday announced measures to attract larger number of new investors to equities and also simplified the registration process for brokers.
At a meeting held here this evening, the Sebi board also approved opening of six new local offices, including one in Srinagar, and the steps for enhancing market surveillance capabilities.
To bring in more transparency in raising of funds through non-convertible preference shares, Sebi also announced a new set of regulations to govern the issuance and listing of such securities. The new set of rules would also help banks to raise funds through this route.
To attract new investors to the equities market, Sebi board also decided to extend the initial offering period for mutual fund schemes launched under RGESS (Rajiv Gandhi Equity Savings Scheme), which provides tax benefits for first time investors.
Prior to its meeting, the Sebi board was addressed by Finance Minister P Chidambaram, who was told about the future agenda of the market regulator and the steps being taken by it for the benefit of markets and investors.
The Sebi board also approved budget for financial year 2013-14 with focus on investor education and awareness, development of the markets, enhancing market surveillance capabilities and improving the access of investors to the regulator.
"In this regard, the Board approved the opening of six more local offices at Ranchi, Raipur, Panaji, Shimla, Dehradun and Srinagar," Sebi said in a statement after the board meeting.
Simplifying the procedural requirements for stock brokers, Sebi also decided to introduce common registration certificates for brokers across different market segments.
The proposal, once implemented, would do away with the current system that require stock brokers to get separate registration certificates from Sebi for every market segment they trade in.
"With a view to simplifying and rationalising the registration requirement, the board decided to amend the regulations for stock brokers so that there may be one certificate of registration per stock exchange for a stock broker," Sebi said.
Presently, a stock broker is required to get separate certificates of registration for operating in different segments of a stock exchange such as equity, equity derivatives, currency derivatives.
Currently, separate registrations are also needed for each category like trading member, trading cum self clearing member and a professional clearing member.
Earlier in the day, Sebi Chairman U K Sinha also promised stern and immediate actions against market manipulators and said investigations into the recent crash of midcap stocks was progressing and some data has been collected in this regard.
However, the information was not conclusive in nature and the probe would continue for some time, he added.
Sinha also said that a uniform KYC norms for FIIs is being worked upon and would be announced shortly. The measure would help attract larger flow of foreign funds into the country.
With regard to the RGESS, Sebi board approved an increase in the initial offer period for RGESS eligible schemes to 30 days, from 15 days at present.
"The timeline for refund of money and sending statement of account has been extended from five working days to 15 days from closure of initial subscription for RGESS eligible schemes," Sebi said.
Under the scheme, announced in the 2012-13 Union Budget, new investors can avail tax benefits who invest up to Rs 50,000 in the stock market and whose gross total annual income is less than or equal to Rs 10 lakh.
The scheme would encourage flow of savings in the financial instruments and improve the depth of the domestic capital market.
Earlier in the evening, Sinha apprised the Finance Minister of the market trends and the recent initiatives taken by the regulator.
Developments related to primary market, secondary market, mutual funds and FIIs were also discussed. Implementation of Union Budget announcements related to Sebi was also discussed.
Complimenting Sebi on the initiatives taken by it, Chidambaram said that Sebi should keep itself abreast of the latest developments in the securities market around the world.
He also asked Sebi to keep pace with the technological advancements and highlighted the need for the regulator to continue its efforts for spreading the mutual funds investments across the country.
Besides Sinha, the meeting was attended by members of the Sebi Board, namely Arvind Mayaram, Naved Masood, Anand Sinha, Prashant Saran, Rajeev Kumar Agarwal, S Raman, V K Jairath, and P C Chhotaray.
Others present included Anup Wadhawan, Joint Secretary in Ministry of Finance (Capital Markets) and Sebi's executive directors.