SEBI Trading Rules Overhaul: Consultation Paper Explained
Why in the news
The market regulator opened a consultation to simplify legacy trading regulations and give exchanges more supervisory power.
Proposed changes
| Area | Proposal |
|---|---|
| Consolidation | One consolidated framework, revising the MSECC (stock exchanges and clearing corporations) and MCCD (commodity derivatives) master circulars |
| MTF net worth | Brokers’ minimum net worth up from ₹3 crore to ₹5 crore (or more if exchanges set it); norm from 2004, last revised 2022 |
| Liquidity and market making | Fold the Liquidity Enhancement Schemes (LES) into one principle-based framework and scrap outdated market-making provisions to help price discovery in thinly traded securities |
Shift in approach
- Routine supervision would be delegated to stock exchanges, making them first-line regulators.
Exam angle
- Current-to-proposed net worth: ₹3 crore to ₹5 crore.