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Parliamentary panel takes up Bill to give Sebi more teeth

The bill seeks to widen the definition of collective investment scheme.

New Delhi | Published: October 25, 2013 4:01:02 am

The parliamentary standing committee has taken up the Securities Laws (Amendment) Bill for consideration and has invited some individuals and institutions to submit their views on it on November 1.

A source close to the development told The Indian Express that the bill is moving ahead and the standing committee has now taken it up for consideration.

The bill,which seeks to widen the definition of collective investment schemes and provides Sebi chairman with the power to authorise search & seizure and arrest people,was earlier re-promulgated as an ordinance by the President.

While the bill will replace the ordinance,it will amend the Securities and Exchange Board of India Act,1992,the Securities Contracts (Regulation) Act,1956 and the Depositories Act,1996.

The source informed that while the bill looks to make Sebi a lot more powerful regulator,there are views emerging that there should be some provision on checks and balances to the powers being conferred upon Sebi and also for capacity building of Sebi as the regulator needs to have adequate resources to carry out its responsibilities.

The bill seeks to widen the definition of collective investment scheme and will now include all pooling of funds beyond Rs 100 crore or above that are not regulated by any law. It also empowers the Sebi chairman to authorise search and seizure of documents relevant to an investigation.

Sebi will not only get explicit powers to order disgorgement of unfair gains but also permits the regulator to attach bank accounts,arrest a person for failing to comply with disgorgement orders or paying the monetary penalty.

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