Powers of SEBI
The various powers of a Stock Exchange are explained below
Relating to Stock Exchanges & Intermediaries
SEBI has wide powers regarding the stock exchanges
and intermediaries dealing in securities. It can ask information from the stock
exchanges and intermediaries regarding their business transactions for
inspection or scrutiny and other purpose.
to Impose Monetary Penalties
SEBI has been empowered to impose monetary
penalties on capital market intermediaries and other participants for a range
of violations. It can even impose suspension of their registration for a short
to Initiate Actions in Functions Assigned
SEBI has a power to initiate actions in regard to
functions assigned. For example, it can issue guidelines to different
intermediaries or can introduce specific rules for the protection of interests
to Regulate Insider Trading
SEBI has power to regulate insider trading or can
regulate the functions of merchant bankers.
Under Securities Contracts Act
For effective regulation of stock exchange, the
Ministry of Finance issued a Notification on 13 September, 1994 delegating
several of its powers under the Securities Contracts (Regulations) Act to SEBI.
SEBI is also empowered by the Finance Ministry to
nominate three members on the Governing Body of every stock exchange.
to Regulate Business of Stock Exchanges
SEBI is also empowered to regulate the business of
stock exchanges, intermediaries associated with the securities market as well
as mutual funds, fraudulent and unfair trade practices relating to securities
and regulation of acquisition of shares and takeovers of companies.