4.5 SIGNIFICANT POLICIES MADE, DECISION TAKEN, AND/OR CASES DECIDED BY SEBI: 1.

DEPOSITORIES ACT, 1996: An Act to provide for regulation of depositories in securities and for matters connected therewith; the act provided the following guide lines:

No depository shall act as a depository unless it obtains a certificate of commencement of business from the Board, following the registration with SEBI of the depository For interfaces between the depository, participants, issuers and beneficial owners, several of which are required to be in the byelaws which a depository has to make with the approval of SEBI Option to investors to hold securities in physical or dematerialized form, or to rematerialize securities previously held in dematerialized form The Act also amends other statutes to facilitate the setting up and functioning of depositories and introduces the free transferability of securities.

2. INTRODUCTION OF DERIVATIVE TRADING, 2000:

The ban imposed on derivatives trading in the year 1969 was revoked and SEBI formulated the necessary regulations and intimated the Stock Exchanges in the year 2000. The derivative trading started in India at NSE in 2000 and BSE started trading in the year 2001; With the Index futures introduction in June 2000, followed by index options in June 2001, and options and futures on individual securities in July 2001 and November 2001, respectively.
3 .THE SECURITIES CONTRACTS (REGULATION) AMENDMENT ACT, 2007:

That seeks to develop the securitization market with facility of listing and trading of securitized certificates or instruments in stock exchanges and it also provides for vesting powers of regulation with the Securities and Exchange Board of India (SEBI). 4. On 14 may 2007 Investment limit of Mutual Funds in ADRs/ GDRs/ Foreign Securities enhanced to USD 4 billion with a sub- ceiling for individual Mutual Funds to 10 per cent of the net assets managed by them on March 31 of each relevant year and subject to a maximum of USD 200 million per Mutual Fund. 5. On 10 June 2007, Relaxation for Government Companies in Infrastructure Sector, in order to facilitate government companies / corporations, statutory authorities/ corporations orany special purpose

vehicle engaged in infrastructure sector to raise funds in the Indian primary market through IPOs, SEBI relaxed certain provisions of SEBI (DIP) guidelines. 6. On 30 April 2007, SEBI (Disclosure and Investor Protection) Guidelines, 2000, amended to reflect processing of draft offer documents, mandatory grading of IPOs, and to provide the eligibility of pledged shares for computations of minimum promoters contribution. Guidelines on pre allotment and QIPs were also amended.

Some other decisions taken by SEBI are as follows:

13th April 2010: BSE and NSE permitted to put in place corporate bond trading platforms to enable efficient price discovery and clearing and settlement in a gradual manner. 27th April 2007: PAN was made the sole identification number for all transactions in securities market irrespective of the amount. 26th October 2007: The tenure of the term deposits placed as margin for trading in derivatives by Mutual funds was fixed for a maximum of 182 days. 16th October 2008: Enhanced limit for FIIs investments limits in debt securities from US $3billion to US $6 billion, subject to ceiling of US $300 million per registered entity. In order to accord flexibility to the FIIs to allocate the investments, restriction of 70:30 ratio of investments in equity and debt have been removed. 23rd October 2009: In consultation with the stock exchanges and other market participants, it was decided to permit the stock exchanges to set their trading hours (in the cash and derivatives segments) subject to the condition that: a. The trading hours are between 9 AM and 5 PM, and b. The exchange has in place risk management system and infrastructure commensurate to the trading hours. 19th January 2010: Eligible stock exchanges were permitted to introduce currency futures on Euro-INR, Pound Sterling-INR and Japanese Yen-INR. Based on feedback received from stock exchanges, the calendar spread margin to be applied on the US Dollar-INR contract was modified. 10th February 2010: A committee was constituted under the Chairmanship of Dr. Bimal Jalan (Former Governor, Reserve Bank of India) for review of ownership and governance of market infrastructure institutions.

1st April 2010: SEBI decided that the Stock Exchanges shall post all their regulatory orders and arbitration awards issued since April 1, 2007, on their websites within 30 days.

 6th April 2010: Earlier, ASBA facility was available to all the investors except Qualified Institutional Buyers (QIBs). SEBI decided to extend the ASBA facility to QIBs in all public issues opening on or after May 1, 2010. 15th April 2010: In order to ascertain the constitution of Foreign Institutional Investors (FII) and Sub Accounts (SA), it has been decided that all applications submitted for registration w.e.f April 07, 2010 shall be accompanied by a declaration and undertaking regarding Protected Cell Company (PCC) & Multi Class Share Vehicle (MCV) on the letter head of respective FII, duly signed by its authorized signatory on behalf of itself and all its Sub Accounts. 16th April 2010: Electronic Data Information Filing and Retrieval System (EDIFAR) was discontinued. 22nd April 2010: Earlier, it used to take on an average around 22 days to list the securities after an IPO/FPO closes. This exposes investors as well as issuing companies to market risk as well as leading to infrastructural stress and costs. In view of the same, it has been decided to reduce the time between issue closure and listing to 12 working days. 13th May 2010: In order to improve transparency in the grievance redressal mechanism Mutual Funds shall henceforth disclose on their websites, on the AMFI website as well as in their Annual Reports, details of investor complaints received by them from all sources. The said details should be vetted and signed off by the Trustees of the concerned Mutual Fund. 30th July 2010: It has been decided that all SEBI Regulated entities shall report their OTC transactions in CDs and CPs on the FIMMDA reporting platform within 15 minutes of the trade for online dissemination of market information with effect from August 16, 2010. 18th August 2010: In order to facilitate transferability of units of mutual funds held in one demat account to another demat account, it has been decided that all AMCs shall clarify by way of an addendum that units of all mutual fund schemes held in demat form shall be freely transferable from the date of the issue of said addendum which shall be not later than October 1, 2010. 25th October 2010: In order to increase retail investor participation and to keep pace with inflation, monetary limit on retail individual investor application was increased from Rs. one lakh to Rs. two lakh.

Likewise SEBI is involved in all activities related to the stock markets, securities exchanges and hence SEBI plays a very important role in regulation and governing the markets, so as to maintain the stability, transparency in the market with a view to benefit the investors in the Indian stock markets.