On October 20, 2023, the Securities and Exchange Board of India (SEBI) issued a vital notification regarding the Securities and Exchange Board of India (Investor Protection and Education Fund) (Second Amendment) Regulations, 2023. These amendments aim to enhance the regulations governing the Investor Protection and Education Fund.
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 20th October, 2023
SECURITIES AND EXCHANGE BOARD OF INDIA (INVESTOR PROTECTION AND EDUCATION FUND) (SECOND AMENDMENT) REGULATIONS, 2023
No. SEBI/LAD-NRO/GN/2023/157.—In exercise of the powers conferred by section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following regulations to further amend the Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009, namely: –
1. These regulations may be called the Securities and Exchange Board of India (Investor Protection and Education Fund) (Second Amendment) Regulations, 2023.
2. They shall come into force on the date of their publication in the Official Gazette.
3. In the Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009 –
I. in regulation 4, in sub-regulation (1),-
(a) the existing clause “(j)” shall be renumbered as clause “(m)”;
(b) after the existing clause (i), the following clauses shall be inserted, namely, –
“(j) monies transferred in accordance with the proviso to sub-regulation (3) of regulation 61A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;
(k) monies transferred in accordance with clause (f) of sub-regulation (16) of regulation 18 of the Securities and Exchange Board of India (Real Estate Investment Trusts) Regulations, 2014;
(l) monies transferred in accordance with clause (e) of sub-regulation (6) of regulation 18 of the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014;”
II. in regulation 5, sub-regulation (3) shall be substituted with the following, namely, –
“(3) Notwithstanding the provisions of sub-regulations (1) and (2),-
i. the amounts disgorged and credited to the Fund in accordance with clause (h) of sub-regulation (1) of regulation 4 of these regulations and the interest accrued thereon shall, in cases where the Board deems fit to make restitution to eligible and identifiable investors who have suffered losses resulting from violation of securities laws or for rewarding informants who provide original information to the Board to recover amounts directed to be disgorged, be utilised only for the purposes of such restitution or reward;
ii. the amounts credited to the Fund in accordance with clauses (j), (k) and (l) of sub-regulation (1) of regulation 4, shall be utilised for refund to the entities transferring the said amounts, pursuant to their making payment to eligible and identifiable investors and making a claim to the Fund in the manner specified by the Board:
Provided that monies remaining in the Fund after earmarking, –
i. the amount for the process of restitution to eligible and identifiable investors credited to the Fund in accordance with clause (h) of sub-regulation (1) of regulation 4; and
ii. the amount for refund to the entities transferring the said amounts credited to the Fund in accordance with clauses (j), (k) and (l) of sub-regulation (1) of regulation 4;
may be utilised for the purposes of the Fund as specified in sub-regulations (1) and (2):
Provided further that no claim for restitution from the disgorged amounts in a specific case shall be admissible after a period of seven years from the date of invitation of claims for disgorgement in the said case by the Board.‖
BABITHA RAYUDU, Executive Director
[ADVT.-III/4/Exty./504/2023-24]
Footnotes:
1. The Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009 were published in the Gazette of India on 19th May 2009 vide notification no. LAD-NRO/GN/2009-10/05/163525.
2. The Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009, were subsequently amended on:
a) January 9, 2014 by the Securities and Exchange Board of India (Investor Protection and Education Fund) (Amendment) Regulations, 2014 vide notification No. LAD/NRO/GN/2013-14/38/49.
b) March 6, 2017 by the Securities and Exchange Board of India (Payment of Fees and Mode of Payment) (Amendment) Regulations, 2017 vide notification No. SEBI/LAD/NRO/GN/2016-17/037.
c) February 28, 2023 by the Securities and Exchange Board of India (Investor Protection and Education Fund) (Amendment) Regulations, 2023 vide notification N SEBI/LAD-NRO/ GN/ 2023/126.
