Sebi issues financial disincentives guidelines for bourses, other MIIs for surveillance lapses

Sebi introduced a framework for "financial disincentives" applicable to market infrastructure institutions (MIIs) like stock exchanges for lapses in detecting abnormal trading activities. Effective from July 1, 2024, fines will be based on the MII's previous financial year revenue and the number of lapses. \r

Surveillance-related lapses include inadequate reporting, failure to implement prescribed measures, and delays. Penalties range from Rs 25 lakh to Rs 1 crore for larger MIIs, while smaller ones face fines from Rs 1 lakh to Rs 20 lakh. \r

However, penalties won't apply to market-wide impacts or procedural matters. MIIs have 15 days to credit fines to Sebi's fund. They must also disclose penalty details on their websites and annual reports.