SEBI Mandates Joint Inspections Of Stock Brokers, Depository Participants From This Financial Year

The Securities and Exchange Board of India on Friday announced an enhanced approach for inspecting market intermediaries, which will come into effect from the financial year 2026-27.

SEBI said the framework, formulated after consultations with Market Infrastructure Institutions and the Supervisory Body for Investment Advisers and Research Analysts, provides for joint inspections of stock brokers and depository participants by stock exchanges and depositories.

To strengthen regulatory oversight and improve ease of doing business, SEBI has reduced the number of inspections it will conduct in FY 2026-27 to about one-third of those carried out in the previous financial year.

The regulator has also discontinued annual comprehensive inspections of compliant entities, particularly Qualified Stock Brokers. Instead, it will prioritise inspections of entities with high risk scores, repeated shortlisting or multiple alerts.

SEBI also said entities with multiple intermediary registrations will, wherever feasible, be inspected jointly by different SEBI departments to reduce repeated inspection visits. Further, inspections will increasingly be based on alerts from exchanges, complaints and social media, with entities being shortlisted every quarter.

The regulator added that it will also carry out inspections based on market intelligence and inputs from its Regional and Local Offices, including in cases involving technical glitches, cyber incidents and the activities of authorised persons of stock brokers.