Securities and Exchange Board of India (Sebi) Chairman Ajay Tyagi has written to the finance ministry, seeking a review of the Budget proposal that mandates transferring 75 per cent of the market regulator’s surplus funds to the central government, it is learnt.
In a letter to the ministry on July 10, Tyagi said the proposed move, part of the Finance Bill, 2019, would affect the functioning of Sebi as well as the securities market. He said the proposal was already being discussed by the Financial Stability and Development Council (FSDC), regulator for the financial sector, and that the amendment to the Sebi Act, through the Finance Bill, could have waited until the Council’s final decision. Tyagi argued on the rationale for the regulator keeping a reserve fund and its importance in protecting the interests of investors.
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The move has also been opposed by the Sebi Employees Association (SEA), brokers’ forum, and many other market participants, saying it potentially amounts to an infringement of the independence of the regulatory body.
An e-mail sent to Sebi did not elicit a response. A text message to Tyagi remained unanswered.
The Sebi chairman is learnt to have met Finance Minister Nirmala Sitharaman earlier this week on the issue.
Source: Business Standard