The Securities and Exchange Board of India (SEBI) is a statutory regulatory body, or institution, operating under the administrative domain of the Ministry of Finance, Government of India. It was first established as a non-statutory executive body on April 12, 1988, to regulate the securities market. SEBI was granted statutory powers on January 30, 1992, with the enactment of the Securities and Exchange Board of India Act, 1992 (Act No. 15 of 1992), which was passed following the Harshad Mehta scam. The problem it solved was the lack of a strong, transparent regulatory structure, which had previously been overseen by the Controller of Capital Issues under the Capital Issues (Control) Act, 1947.
SEBI's core function, as stated in the Preamble of the SEBI Act, 1992, is to protect the interests of investors in securities, promote the development of, and regulate the securities market. It operates with three powers rolled into one: quasi-legislative (drafting regulations), quasi-executive (investigation and enforcement), and quasi-judicial (passing rulings and orders). The Act, which contains 10 chapters and 91 sections, outlines penalties for contraventions, such as insider trading (Section 15G) and fraudulent and unfair trade practices (Section 15HA). Appeals against SEBI's orders are heard by the Securities Appellate Tribunal (SAT), with a second appeal lying directly to the Supreme Court.
SEBI's regulatory framework is closely connected to the Securities Contracts (Regulation) Act, 1956 (SCRA), which defines "securities," and the Depositories Act, 1996. In 2015, the Forward Markets Commission (FMC) was merged with SEBI via the Finance Act, 2015, expanding its jurisdiction to the commodity derivatives market. A significant change occurred with the Securities Laws (Amendment) Act, 2014, which enhanced SEBI's powers, including the authority for search and seizure. More recently, in June 2026, SEBI adopted a new code of conduct for its board members, which includes a restriction on whole-time members from making fresh investments in equities during their tenure to strengthen transparency.