Stock Brokers can now heave a sigh of relief after securities market regulator SEBI reduced the turnover fees levied on them by 25 per cent to Rs 15 per crore of turnover from the current Rs 20 per crore of turnover.

Announcing a slew of measures in its board meeting at Jaipur on Saturday SEBI said “This will result in reduction of overall cost of transactions and will benefit the investors and promote the development of securities market”.

Open offer/takeover fee

SEBI also decided to align the fees payable for buy back of securities with the fees payable for an open offer. The fee to be charged for open offer/takeover has been increased from Rs 3 lakh to Rs 5 lakh.

Also introduced were filing fees for draft scheme of arrangement and processing fee for application seeking relaxation under Regulation 113 of SEBI (Issue of Capital and Disclosure Requirements) Regulations.


Akin to the provision for imposition of fines under SEBI listing regulations, the regulator introduced a similar clause in its Issue of Capital and Disclosure Requirements Regulations (IPO /FPO regulations). “The provisions enable actions such as imposition of fines, suspension of trading, etc. by stock exchanges for contravention of ICDR Regulations. This will reduce cost of undertaking adjudication/quasi-judicial actions in case of minor violations for the listed entities,” SEBI said.

SEBI will issue circular/guidelines providing for standard operating procedure for imposing of fines, etc. on violation of certain provisions of ICDR Regulations in consultation with stock exchanges based on the amended regulations.

Sumit Agarwal Partner Suvan Law Advisor & ex- Sebi Official said " In regulation of listed companies, SEBI draws a lot of comfort from Stock Exchanges who are first-line regulators. Delegating responsibilities to them under ICDR Regulations, through empowering them, also makes them accountable for any malfunctioning in the listed company. Though there remains a legal issue – whether quasi-judicial functions of imposing penalty can be delegated by way of subordinate regulations, when parliament has cast those obligations on SEBI under statutes. It needs to be seen if it passes muster from the courts when Exchanges would start using those powers.”

Easing Municipal Bond regulations

SEBI eased the net worth criteria for municipalities making a public issue of debt securities. Now, municipalities with surplus as per their Income and Expenditure Statement, in any of the three immediately preceding financial years are allowed to raise debt . Earlier only those municipalities which did not have negative worth in the last three years were allowed to raise debt using municipal bonds.

Also approved were amendments to settlement under civil proceedings besides allowing the use of digital payment modes such as RTGS /NEFT for market-men making payments to SEBI.

“It is a good idea that SEBI is allowing re-application of rejected or withdrawn applications in deserving cases. Having a blanket ban was not meaningful purpose of the proceeding. Similarly, it was a hassle when SEBI imposes a joint and several liability of penalty on many people in a case and only few would want to settle while others would challenge. This would save time of Regulator as well as the noticee," Agarwal summed up.