SEBI Streamlining Settlement Cases for Transparency and Predictability
Market regulator SEBI is on the brink of implementing a groundbreaking initiative aimed at revolutionizing the handling of settlement cases. This new Standard Operating Procedure (SoP) is set to bring about a standard approach, reduce subjectivity, and elevate transparency within the regulatory process. These crucial developments were recently disclosed by SEBI’s whole-time member, Kamlesh Chandra Varshney, during a conference focusing on the economics of competition law organized by the Competition Commission of India.
Varshney revealed that SEBI is diligently working towards finalizing the SoP to establish a structured methodology for navigating various types of settlement cases. This innovative framework is also expected to introduce a formula for settlements, thus ushering in a new era of predictability and fairness for both the regulator and market participants.
SEBI’s Success with Settlements
Drawing attention to SEBI’s rich history of settlement cases, Varshney shed light on a remarkable trend observed within the organization. He emphasized that settling cases often results in higher payments compared to litigation, a testament to the efficacy of this alternative dispute resolution mechanism.
“In the past five years, we have witnessed a significant shift in our approach to settlements. What was once a mere 10% of our enforcement orders now stands at a substantial 45% being settled,” Varshney shared. This shift not only underscores the effectiveness of settlements but also highlights their invaluable role in alleviating the burden on regulatory bodies.
Varshney further elaborated on SEBI’s strategic target of resolving 60 cases per month in the upcoming fiscal year, a notable increase from the current rate of 45 cases per month. This proactive approach signifies SEBI’s commitment to enhancing operational efficiency and ensuring timely resolution of regulatory matters.
The Imperative for a Standard Operating Procedure
With a surge in settlement applications in recent years, SEBI has recognized the pressing need for a standardized framework to streamline its operations. The absence of a cohesive SoP has occasionally resulted in delays and inconsistencies in handling similar cases, underscoring the urgency for a structured approach.
By introducing the SoP, SEBI aims to uphold market integrity, bolster regulatory efficiency, and expedite the resolution of violations in a just and equitable manner. This transformative initiative is poised to usher in a new era of uniformity, transparency, and regulatory predictability within the realm of settlement cases.
As SEBI continues to pave the way for a more structured and transparent regulatory landscape, the forthcoming implementation of the SoP heralds a significant milestone in the evolution of settlement procedures. By establishing a standardized approach, SEBI is poised to enhance market integrity, foster regulatory efficiency, and uphold fairness in the resolution of securities law violations.
