SEBI Forex Regulation – How Does it Work?
SEBI, which is also known as the Securities and Exchange Board of India is a regulatory body, which regulates the securities and commodity market in the country. As Forex trading in India becomes more and more popular and the number of brokers increases gradually, they are obliged to be licensed by this regulatory body.
SEBI is a self-regulatory organization and it operates under the jurisdiction of the Ministry of Finance. The organization was established on the 12th of April in 1992. It is headquartered in Bandra Kurla Complex, Mumbai. The main obligation and responsibility of SEBI, apart from controlling and regulating commodity markets and securities, is to protect investors’ rights and make the environment more transparent and attractive for people. What’s more, SEBI formulates the guidelines for companies that are linked to the financial sector and operate in India, including Forex brokers. SEBI registered Forex brokers are famous for their reputation and the way they are performing in the marketplace.
In order to get a license from SEBI, Forex brokers need to take several steps, which is also known as examination. As it means a lot to be protected from malpractice and fraud brokers, SEBI is there for FX traders to minimize the chances of being the victim of fraud. Moreover, SEBI is responsible for investors’ security and transparency of financial trading, which makes it one of the most famous regulatory organizations around the world.
SEBI is the successor of Controller of Capital, which was considered a regulatory body before SEBI came into existence. Controller of Capital became the regulatory body after the 1947 act, which is known as Capital Issues (Control) Act.