SEBI Imposes Stricter Rules: No New Equity Investments, Gifts Over ₹50,000 Prohibited
GS3Economy · S&T · Environment · Security· Capital markets & SEBI· Prelims + Mains·
Why in news
SEBI approved a new code of conduct on June 19, 2026, to enhance transparency and accountability following allegations against its former chief.
Background
The new code applies to both Whole-Time Members (WTMs) and Part-Time Members (PTMs) of SEBI. Key restrictions include a ban on new equity investments during tenure and a cap on gifts at ₹50,000.
Facts for Prelims
- BodySEBI: Securities and Exchange Board of India, a statutory body established under the SEBI Act, 1992
- FactGift limit: SEBI members are prohibited from accepting gifts exceeding ₹50,000
- FactInvestment restriction: Whole-Time Members (WTMs) are barred from making new equity investments during their tenure
- FactRecusal: Members must recuse themselves from discussions involving entities where they have significant financial interests
For Mains
Q. Discuss the importance of robust ethical frameworks and conflict-of-interest regulations in maintaining the integrity of capital market regulators like SEBI.
Dimensions to cover in your answer
- Institutional integrity: Preventing 'regulatory capture' where regulators favor entities with whom they have personal financial ties
- Transparency mechanism: Mandatory disclosure of personal information to mitigate perceptions of nepotism or biased decision-making
- Conflict of interest: Balancing the personal investment rights of regulators against the objective oversight of the securities market
Keywords: Regulatory Capture · Conflict of Interest · Transparency · Accountability · Capital Market Integrity
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