SEBI Proposes Mandatory Record-Keeping for Regulated Entities to Enhance Transparency

The Securities and Exchange Board of India (SEBI) has released a consultation paper seeking public feedback on a proposal that would require all regulated entities to maintain records of mandatory communications, including acknowledgments, for a minimum of eight years.

This initiative aims to bolster transparency, regulatory compliance, and investor protection within the securities market. Currently, SEBI-regulated entities are obligated to communicate various types of information to stakeholders, but only a limited subset of these communications must be preserved.

The proposed changes would extend this requirement to all mandatory communications, thereby strengthening evidence trails for identifying potential breaches of securities laws and facilitating the resolution of investor grievances.

The consultation paper outlines proposed amendments to various SEBI regulations to implement these record-keeping requirements. Under the new rules, entities would need to ensure that records of all mandatory communications are accessible to SEBI upon request, enhancing regulatory oversight and accountability.

SEBI has invited comments from stakeholders, with a deadline of September 13, 2024. This proposal is part of its broader mandate to protect investors and ensure market integrity by improving the auditability of communications between regulated entities and their stakeholders.

SEBI encourages feedback from the public and industry participants to refine and finalize the proposed regulatory changes.