SEBI alters investors grievance redressal system, arbitration mechanism
Market regulator Securities and Exchange Board of India (SEBI) announced amendments to their investors grievance redressal system and arbitration mechanism at stock exchanges. As per a SEBI circular released on 22 October, the amendments will come into effect 1 January 2022.
The amendments aim to “further enhance the effectiveness of Investor Grievance Redressal System and Arbitration Mechanism at the Stock Exchanges, based on the internal deliberations/discussions, and the feedback received from the Stock Exchange,” as per the circular.
Under the new framework, SEBI scrapped the need to form an appellate arbitration panel- members will now serve on both arbitration and appellate arbitration panels. However the same members will not be serving on both the arbitration panel and appellate panel for the same matter. Furthermore, the place of arbitration may take place in the nearest metro city if the case reward amount exceeds Rs. 50 lakh.
With regard to the grievance redressal committee, SEBI announced different threshold limits for interim relief provided to clients by the Investor Protection Fund (IPF) of the stock exchange. The regulatory body stated that the total amount released to a client through interim relief from IPF should not exceed Rs 10 lakh in a financial year.
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