SEBI plans a simplified rulebook for stock exchanges, removing obsolete provisions

Capital markets regulator Sebi on Monday proposed changes to the regulatory framework governing stock exchanges and clearing corporations as part of its broader ease of doing business initiative. In a consultation paper, the regulator said it aims to simplify the master circular for stock exchanges and clearing corporations by removing obsolete provisions, reducing compliance requirements and consolidating multiple circulars into a single framework. Public comments on the proposals are invited till July 13, 2026.

The latest consultation is the fourth in a series of reviews undertaken by Sebi to ease regulations for market infrastructure institutions (MIIs). The regulator had earlier sought feedback on proposals related to administration, trading and exchange-traded derivatives.

Among the key proposals, SEBI plans to issue a single master circular for stock exchanges by consolidating provisions related to stock exchanges and commodity derivatives exchanges. It also intends to issue a separate master circular for clearing corporations and another consolidated circular covering general information technology requirements applicable to market infrastructure institutions.

The regulator has also proposed to reduce the number of periodic reports submitted to SEBI by discontinuing reports that have become redundant or shifting them to monitoring by MII committees.

Other proposed changes include discontinuing the registration requirement for investment managers offering direct market access (DMA) services, introducing a single-window registration framework for brokers offering smart order routing (SOR), reviewing the existing system and network audit framework for market infrastructure entities and discontinuing the close-to-money contract (contract no) option.

SEBI has also suggested reviewing disclosure requirements for investors in commodity derivatives, reviewing norms governing position limits across products, updating the client code modification framework and merging investor protection funds for equity and commodity segments.

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According to the regulator, the review aims to create a more efficient and principles-based regulatory framework for exchanges and clearing corporations while reducing duplication and improving operational flexibility.

The final framework will be notified after considering the comments received from market participants and other stakeholders.

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