Sebi board to finalise norms for regulatory sandboxes on Feb 17

nMUMBAI: The board of Securities and Exchange Board of India (Sebi) will finalise norms for so-called regulatory sandboxes, proxy advisors and Infrastructure Investment Trusts (Invits) at its February 17 meeting, the last to be headed by chairman Ajay Tyagi unless he gets an extension, two people with direct knowledge of the matter said.

Tyagi, whose three-year tenure at the helm of Sebi ends in March, is eligible for renewal for up to two years. Several of his unfinished initiatives are on the agenda of the Sebi board, but due to divided opinions and lack of government clearances, the board will finalise only the above three which are solely under its regulatory domain, the people cited above said on condition of anonymity.

A regulatory sandbox, which is under Sebi’s consideration, is a framework that permits live-testing of new financial products or services in a controlled environment. “The exchanges and market infrastructure institutes have already implemented innovative sandboxes on their end. So, this time, we are taking to the board the regulatory sandbox which will not just allow companies to test their fintech solutions in isolation from live market, but also enable Sebi to form policies and regulations encouraging them,” said a regulatory official, one of the two people cited earlier.

“Sebi will grant them certain relaxations from some regulations and guidelines,” the official said, adding relaxations will be granted on only those items which are hampering the proposed innovations and “acting as barriers to entry of new products”.

Sebi is also expected to finalise norms outlined in the discussion paper it issued in August.