Budget 2021: bye, bye multiple laws, hello 1 market code
NEW DELHI: The Minister of Finance proposed on Monday that important securities laws be summarized in a code, a Move which has the potential to unite several pieces of legislation into one. It could avoid duplication of work, increase clarity about these laws and reduce the cost of them observance, said securities law experts.
On Monday, the FM proposed that the provisions of the Sebi Act, 1992, Depositories Act, 1996, Securities Contracts (regulation) Act 1956 and Government Securities Act 2007 into a streamlined uniform securities market code.
According to Sandeep Parekh, managing partner of Finsec Law Advisors, the idea of uniform securities market law was often discussed in the past, but is now being implemented. “It’s going to be a cohesive piece of legislation, as opposed to the piecemeal approach we’ve had so far.” The move on securities laws seems to be aimed at the government’s goal of “Ease of Doing Business” from a larger perspective.
“The consolidation of securities laws, the existing decriminalization of criminal offenses after the Companies act and the proposed decriminalization under LLP law is an important step in making the Indian corporate legal framework simpler, more business-friendly and ultimately (hopefully) reducing compliance costs, ”said Arka Mookerjee, Partner, J Sagar Associates.
The proposed Securities Markets Code is in line with previous discussions about the NFRA (National Financial Reporting Authority), an independent regulatory agency responsible for overseeing the accounting profession and accounting standards in India.
“If properly designed and executed, it will help market participants and resolve potential conflicts,” said Mookerjee.
On Monday, the FM proposed that the provisions of the Sebi Act, 1992, Depositories Act, 1996, Securities Contracts (regulation) Act 1956 and Government Securities Act 2007 into a streamlined uniform securities market code.
According to Sandeep Parekh, managing partner of Finsec Law Advisors, the idea of uniform securities market law was often discussed in the past, but is now being implemented. “It’s going to be a cohesive piece of legislation, as opposed to the piecemeal approach we’ve had so far.” The move on securities laws seems to be aimed at the government’s goal of “Ease of Doing Business” from a larger perspective.
“The consolidation of securities laws, the existing decriminalization of criminal offenses after the Companies act and the proposed decriminalization under LLP law is an important step in making the Indian corporate legal framework simpler, more business-friendly and ultimately (hopefully) reducing compliance costs, ”said Arka Mookerjee, Partner, J Sagar Associates.
The proposed Securities Markets Code is in line with previous discussions about the NFRA (National Financial Reporting Authority), an independent regulatory agency responsible for overseeing the accounting profession and accounting standards in India.
“If properly designed and executed, it will help market participants and resolve potential conflicts,” said Mookerjee.