India : Role of Self-Regulatory Organizations in Securities Market Regulation

This Note identifies four main theoretical options for securities markets self-regulation in India, based on precedents from international markets. There is no single 'right' approach - the note outlines three options that employ Self Reg...

Full description

Bibliographic Details
Main Author:	World Bank
Format:	Policy Note
Language:	English en_US
Published:	Washington, DC 2013
Subjects:	CENTRAL INDEPENDENT SRO EXCHANGE MARKET QUALITY EXCHANGE SRO SYSTEM HYBRID SRO STRUCTURE JOINT SRO SUBSIDIARY SECURITIES MARKETS SELF-REGULATION SRO SRO MEMBERS SELF-REGULATORY ORGANIZATION
Online Access:	http://documents.worldbank.org/curated/en/2007/06/16450195/india-role-self-regulatory-organizations-securities-market-regulation http://hdl.handle.net/10986/12720

id	okr-10986-12720
recordtype	oai_dc
spelling	okr-10986-127202021-04-23T14:03:04Z India : Role of Self-Regulatory Organizations in Securities Market Regulation World Bank CENTRAL INDEPENDENT SRO EXCHANGE MARKET QUALITY EXCHANGE SRO SYSTEM HYBRID SRO STRUCTURE JOINT SRO SUBSIDIARY SECURITIES MARKETS SELF-REGULATION SRO SRO MEMBERS SELF-REGULATORY ORGANIZATION This Note identifies four main theoretical options for securities markets self-regulation in India, based on precedents from international markets. There is no single 'right' approach - the note outlines three options that employ Self Regulatory Organizations (SROs), which could be viable solutions for Indian capital markets. These are: (1) Restructure the existing Exchange SRO system to create a joint SRO subsidiary of the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The new entity would be responsible for both market and member regulation. The Exchanges provide an existing platform for SRO functions that works reasonably well. This platform includes a governance structure, professional management, experienced staff, documented programs and procedures, and IT tools. But this option raises all of the issues on conflicts of interest at Exchange SROs. (2) Hybrid structure: NSE and BSE retain responsibility for market regulation, and create a new independent SRO for member regulation. This option is very similar to Association of National Stock Exchange Members of India's (ANMI's) proposal to create a member-based SRO (but the SRO should not be based on a trade association because of the significant conflicts of interest). It is based on the idea that supervising members is best done by a central regulator, but that regulating its own market is essential to an Exchange's market quality and brand. (3) New central independent SRO for both market and member regulation. A single independent SRO is theoretically the cleanest and efficient solution. But it is difficult to develop and in fact is only now in the process of being implemented in the USA and Canada. 2013-03-14T15:30:27Z 2013-03-14T15:30:27Z 2007-06 http://documents.worldbank.org/curated/en/2007/06/16450195/india-role-self-regulatory-organizations-securities-market-regulation http://hdl.handle.net/10986/12720 English en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Washington, DC Economic & Sector Work :: Policy Note Economic & Sector Work South Asia India
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	CENTRAL INDEPENDENT SRO EXCHANGE MARKET QUALITY EXCHANGE SRO SYSTEM HYBRID SRO STRUCTURE JOINT SRO SUBSIDIARY SECURITIES MARKETS SELF-REGULATION SRO SRO MEMBERS SELF-REGULATORY ORGANIZATION
spellingShingle	CENTRAL INDEPENDENT SRO EXCHANGE MARKET QUALITY EXCHANGE SRO SYSTEM HYBRID SRO STRUCTURE JOINT SRO SUBSIDIARY SECURITIES MARKETS SELF-REGULATION SRO SRO MEMBERS SELF-REGULATORY ORGANIZATION World Bank India : Role of Self-Regulatory Organizations in Securities Market Regulation
geographic_facet	South Asia India
description	This Note identifies four main theoretical options for securities markets self-regulation in India, based on precedents from international markets. There is no single 'right' approach - the note outlines three options that employ Self Regulatory Organizations (SROs), which could be viable solutions for Indian capital markets. These are: (1) Restructure the existing Exchange SRO system to create a joint SRO subsidiary of the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The new entity would be responsible for both market and member regulation. The Exchanges provide an existing platform for SRO functions that works reasonably well. This platform includes a governance structure, professional management, experienced staff, documented programs and procedures, and IT tools. But this option raises all of the issues on conflicts of interest at Exchange SROs. (2) Hybrid structure: NSE and BSE retain responsibility for market regulation, and create a new independent SRO for member regulation. This option is very similar to Association of National Stock Exchange Members of India's (ANMI's) proposal to create a member-based SRO (but the SRO should not be based on a trade association because of the significant conflicts of interest). It is based on the idea that supervising members is best done by a central regulator, but that regulating its own market is essential to an Exchange's market quality and brand. (3) New central independent SRO for both market and member regulation. A single independent SRO is theoretically the cleanest and efficient solution. But it is difficult to develop and in fact is only now in the process of being implemented in the USA and Canada.
format	Economic & Sector Work :: Policy Note
author	World Bank
author_facet	World Bank
author_sort	World Bank
title	India : Role of Self-Regulatory Organizations in Securities Market Regulation
title_short	India : Role of Self-Regulatory Organizations in Securities Market Regulation
title_full	India : Role of Self-Regulatory Organizations in Securities Market Regulation
title_fullStr	India : Role of Self-Regulatory Organizations in Securities Market Regulation
title_full_unstemmed	India : Role of Self-Regulatory Organizations in Securities Market Regulation
title_sort	india : role of self-regulatory organizations in securities market regulation
publisher	Washington, DC
publishDate	2013
url	http://documents.worldbank.org/curated/en/2007/06/16450195/india-role-self-regulatory-organizations-securities-market-regulation http://hdl.handle.net/10986/12720
_version_	1764421654626172928

India : Role of Self-Regulatory Organizations in Securities Market Regulation

Similar Items