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The Union Cabinet today approved the amendments to Section 13 contained in the Securities Laws (Amendment) Ordinance, 2004. The Ordinance will be replaced by a Bill to be introduced in the Winter Session of Parliament.
In the Budget 2004-05 the Finance Minister had announced the Government’s intention to create an appropriate trading platform for small and mid-cap companies. To give effect to this announcement, additional amendments, of a minor nature, in Section 13 of Securities Contracts (Regulation) Act, 1956 (SCRA), were suggested by Securities and Exchange Board of India (SEBI) based on the legal advice received by them. The amendments made in this section were that instead of the words “members of a recognized exchange”, the words “members of a recognized stock exchange or recognized; stock exchanges” and for the words “State or area” wherever they occur, the words “State or States or area” have been substituted. Besides, in order to provide safeguards against possible misuse, a proviso was added to the effect that where any contract is entered into between members of two or more stock exchanges such contract shall be subject to such permission, terms and conditions as may be stipulated by the respective stock exchange in this regard with prior approval of SEBI.
This will help in implementing, inter-alia the proposal to create an appropriate trading platform for small and mid-cap companies.
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