Parliamentary Standing Committee to discuss Securities Markets Code Bill today
New Delhi, June 11
The Parliamentary Standing Committee on Finance will meet twice on Thursday to discuss the Securities Markets Code Bill, 2025, which proposes to merge the Securities Contracts Act, 1956, the SEBI Act, 1992, and the Depositories Act, 1996 into a single statute.
In its first sitting, scheduled at 11 am, the Committee will hear oral evidence from representatives of the Ministry of Law and Justice (Department of Legal Affairs and Legislative Department) on the Bill.
In the second sitting at 2 pm, representatives of the Ministry of Finance (Department of Economic Affairs) will appear before the Committee for a clause-by-clause examination of the proposed legislation.
The Standing Committee is chaired by BJP MP Bhartruhari Mahtab.
The Securities Markets Code seeks to establish a principle-based legislative framework aimed at reducing compliance burdens, strengthening regulatory governance, and supporting the growth of technology-driven securities markets, thereby promoting ease of doing business.
The Bill proposes to strengthen SEBI's regulatory capacity by expanding the Board from nine to up to fifteen members, while mandating a transparent and consultative approach for issuing subordinate legislation.
To enhance credibility and integrity in decision-making, the Code introduces strict conflict-of-interest norms, requiring Board members to disclose any direct or indirect interests and to recuse themselves where conflicts arise.
The Code spans subjects including board composition, independence, conflict management, transparency, regulatory sandboxing, investor protection, governance of market infrastructure institutions, and Ease of Doing Business.
The Code decriminalises minor, procedural, and technical violations, converting them into civil defaults. Criminal liability is restricted to serious offences such as market abuse, non-compliance with quasi-judicial orders, and non-cooperation during investigations.
Investor protection is further strengthened through measures to promote investor education, awareness, and time-bound grievance redressal, including the introduction of an Ombudsperson mechanism.
The Code also empowers SEBI to establish a Regulatory Sandbox for the development of a new product, contract or service in the securities markets, along with any exemptions or modifications.
The Finance Minister proposed sending the Securities Markets Code (SMC) Bill, 2025, to the Standing Committee for further examination.
— ANI
Reader Comments
I like the idea of an Ombudsperson for investor grievances. Time-bound redressal is what we desperately need. But why are there only 9 to 15 members on SEBI board? With such complex markets, we need diverse expertise—more women, more retail investor representatives, not just bureaucrats.
As an NRI looking to invest more in India, this is encouraging. But I hope the consultative approach for subordinate legislation doesn't become a bureaucratic maze. The sandbox idea is brilliant for fintech—hope it gets implemented quickly without red tape.
Good move by the standing committee. Mahtab ji is experienced. But I'm skeptical—merging acts doesn't automatically reduce corruption. We need strict monitoring of SEBI's expanded board. More members means more potential for lobbying. Hope the conflict-of-interest norms are enforced strictly, not just on paper.
Decriminalising technical violations is a relief for honest businesses. But will this embolden bad actors? Criminal liability for serious fraud and non-compliance with orders is essential. I just hope the Ombudsperson has enough teeth to act swiftly. Retail investors like my parents need that protection. 🙏
Interesting to see India moving towards a principles-based framework. The EU and US have similar trends. But the devil is in the details. How will the sandbox work with STT and other taxes? Also, what about cross-border coordination? Hope the panel discusses these practical aspects.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.