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‡ The Securities and Exchange Board of India was
established on April 12, 1992 in accordance with
the provisions of the Securities and Exchange
Board of India Act, 1992.
The basic functions of the Securities and Exchange
Board of India is


 
 




 
  


 
 
 


 
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‡ The primary objective of SEBI is to promote healthy
and orderly growth -of the securities market and
secure investor protection. The objectives of SEBI
are as follows:
‡ To protect the interest of investors, so that, there is a
steady flow of savings into the capital market.
‡ To regulate the securities market and ensure fair
practices.
‡ To promote efficient services by brokers, merchant
bankers, and other intermediaries, so that, they
become competitive and professional.
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‡ The SEBI Act, 1992 has entrusted with two
functions, they are

‡ Regulatory functions and

‡ Developmental functions
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‡ Regulation of stock exchange and self regulatory
organizations.
‡ Registration and regulation of stock brokers, sub-
brokers, Registrars to all issues, merchant bankers,
underwriters, portfolio managers etc.
‡ Registration and regulation of the working of
collective investment schemes including mutual
funds.
‡ Prohibition of fraudulent and unfair trade practices
relating to securities market.
‡ Prohibition of insider trading
‡ Regulating substantial acquisition of shares and
takeover of companies.





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‡ Promoting investor¶s education
‡ Training of intermediaries
‡ Conducting research and publishing information
useful to all market participants.
‡ Promotion of fair practices
‡ Promotion of self regulatory organizations
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‡ Power to call periodical returns from recognized
stock exchanges.
‡ Power to compel listing of securities by public
companies.
‡ Power to levy fees or other charges for carrying
out the purposes of regulation.
‡ Power to call information or explanation from
recognized stock exchanges or their members.
‡ Power to grant approval to bye-laws of
recognized stock exchanges.
‡ Power to control and regulate stock exchanges.
‡ Power to direct enquiries to be made in relation
to affairs of stock exchanges or their members.
‡ Power to make or amend bye-laws of recognized
stock exchanges.
‡ Power to grant registration to market
intermediaries.
‡ Power to declare applicability of Section 17 of the
Securities Contract (Regulation) Act 1956, in any
State or area, to grant licenses to dealers in
securities.
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‡ The SEBI Act provides for the establishment of a
Statutory Board consisting of six members. The
chairman and two members are to be appointed by the
Central Government, one member to be appointed by the
Reserve Bank and two members having experience of
securities market to be appointed by the Central
Government.
‡ SEBI has divided the activities into four operational
departments. They are primary market department,
issue management and intermediary¶s department,
secondary market department and institutional
department. Each department is headed by an Executive
Director.
 

 



‡ The Central Government has power to issue

directions to SEBI Board, supersede the Board, if
necessary and to call for returns and reports as and
when necessary. The Central Government has also
power to give any guideline or to make regulations
and rules for SEBI and its operations.
‡ The activities of SEBI are financed by grants from
Central Government, in addition to fees, charges etc.
collected by SEBI. The fund called SEBI General
Fund is set up, to which, all fees, charges and grants
are credited. This fund is used to meet the expenses
of the Board and to pay salary of staff and members
of the body.