SEBI to discuss reforms at board meet today

A number of other important matters will also be discussed, such as amendments to rules on buyback of shares, takeovers, registrars and bankers to issues as well as suspension and revocation of trading, government sources said.

The Securities and Exchange Board of India is planning to take a number of measures for development of the market including reduction in additional expenses charged by mutual funds, strengthening the algorithmic trading framework, higher investment limits for angel funds and a fresh compliance framework for companies undergoing Corporate Insolvency Resolution Process (CIRP) under the Bankruptcy Code. These are among the measures that the markets regulator will consider for approval at its Board meeting today (Wednesday).

A number of other important matters will also be discussed, such as amendments to rules on buyback of shares, takeovers, registrars and bankers to issues as well as suspension and revocation of trading, government sources said. Sebi is planning to reduce the additional expense that mutual funds are allowed to charge to a maximum of 5 basis points from 20 basis points at present. With regard to algorithmic trading, the Sebi has proposed a review of trading requirement for algo software for strengthening the algorithmic trading framework by mandating stock exchanges to provide a simulated market environment for testing of software used for such high-frequency trades.

The regulator may also mandate the exchanges to offer shared co-location facilities and providing some services for free. Penalty norms in case of algo trades are proposed to be tightened in order to ensure that genuine buy and sell orders are processed through this channel. For listed companies undergoing CIRP under the Bankruptcy Code, Sebi plans to bring in additional disclosure requirements as well as amend norms pertaining to minimum public shareholding norms and other provisions for such entities.

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Sources said amendments are being proposed for certain Sebi norms on the basis of three stages of resolution- pre-CIRP, ongoing resolution statge and post CIRP stages.

The regulator is also looking to provide an impetus to the early-stage startup ecosystem by increasing the maximum investment by angel funds in venture capital undertakings to Rs 10 crore from the current Rs 5 crore.