General Information - Capital Market Regulation

Securities:

Several public sector undertakings have issued "debt instruments" commonly known as PSU bonds. These bonds are securities as defined under the SCR Act. Interest earned on some of these PSU bonds are not liable to income tax.

• Regulating the business in stock exchange and any other securities markets
• Registering and regulating the working of collective investment schemes, including mutual funds.
• Prohibiting fraudulent and unfair trade practices relating to securities markets.
• Promoting investor's education and training of intermediaries of securities markets.
• Prohibiting insider trading in securities, with the imposition of monetary penalties on guilty market intermediaries.
• Regulating substantial acquisition of shares and takeover of companies.
• Calling for information from, carrying out inspection, conducting inquiries and audits of the stock exchanges and intermediaries and self-regulatory organizations in the securities market.
• Carry forward deals permitted only on stock exchanges, which have screen, based trading system.
• Transactions carried forward cannot exceed 25% of a broker's total transactions on any one day.
• 90-day limit for carry forward and squaring off allowed only till the 75th day (or the end of the fifth settlement).
• Daily margins to rise progressively from 20% in the first settlement to 50% in the fifth.