Sebi Planning to Toughen Listing Norms

Friday, May 15, 2026

India’s securities regulator, Sebi, is considering stricter enforcement measures against promoters and companies repeatedly breaching listing and disclosure rules, including the possibility of attaching promoters' bank accounts and properties. This move aims to increase accountability and deter non-compliance amid a rise in violations, potentially reshaping corporate governance in the country's capital markets.

India’s securities market regulator is considering measures to strengthen enforcement against promoters and companies that repeatedly violate listing and disclosure requirements. The Securities and Exchange Board of India (Sebi) is reportedly exploring options to attach the bank accounts and properties of promoters who fail to comply with regulations for more than two consecutive quarters and also default on penalty payments.

According to individuals familiar with the ongoing discussions, Sebi aims to revise its penalty framework to impose higher monetary fines on firms and introduce norms that could sanction promoters more severely than the companies themselves. This approach intends to discourage publicly traded entities from treating listing regulations lightly.

The proposed tightening of rules comes in response to a significant number of compliance breaches recorded in recent years. Data from the Bombay Stock Exchange (BSE) shows that 2,498 cases of non-compliance were reported in the fiscal year ended March 31. Common violations included delays or failures in submitting annual reports, shareholding disclosures, and financial results.

Amit Tandon, founder and managing director of Institutional Investor Advisory Services India Ltd (IiAS), welcomed the regulator’s initiative, saying measures such as attaching promoters’ assets in cases of persistent and overdue penalties could be effective. He further suggested that Sebi should classify violations by severity and clearly define the corresponding ranges of penalties applicable to promoters.

Currently, Sebi has provisions to penalize or suspend companies that remain non-compliant over extended periods. However, the planned changes appear focused on enhancing accountability at the promoter level, addressing concerns that penalties applied solely to companies may not sufficiently deter non-compliance.

Sebi had not responded to requests for comment at the time of reporting. The regulator’s forthcoming decisions are expected to have notable implications for corporate governance practices among listed entities in India’s capital markets.