SEBI Informal Guidance Scheme 2025: No-Action & Interpretation

SEBI (Informal Guidance) Scheme 2003: An In-Depth Overview

The SEBI (Informal Guidance) Scheme 2003, effective from June 24, 2003, was established to assist intermediaries, listed companies, and other eligible entities in clarifying regulatory compliance issues within India’s securities markets. The scheme aims to foster transparency and certainty for market participants by offering two primary forms of guidance: No-Action Letters and Interpretative Letters.

Types of Guidance Provided

No-Action Letters: These indicate that SEBI does not intend to recommend enforcement action if the applicant proceeds as described in their request.
Interpretative Letters: These provide SEBI’s view or interpretation of specific legal provisions as they apply to the applicant’s circumstances.

It is crucial to note that these communications are not binding on SEBI, do not constitute legal orders, and cannot be appealed.

Application Process

Steps for Submitting an Application:

Fee Structure: Applicants must pay ₹25,000, which includes a non-refundable processing fee of ₹5,000.
Disclosure Requirements: The application must clearly state all material facts, relevant circumstances, and applicable legal provisions.
Submission: Requests are to be sent to the appropriate SEBI department, specifying whether the request is for a No-Action or Interpretative Letter.
Payment Methods: Fees can be paid via NEFT, RTGS, IMPS, or SEBI’s online payment gateway.

Processing Timeline and Procedure:

SEBI endeavors to respond within 60 days of receiving the application.
The concerned department may request an interview or additional information if necessary.
Applicants receive only the response; SEBI’s internal records and deliberations remain confidential.
SEBI is not obligated to provide reasons for rejecting an application.

Eligibility Criteria

Entities eligible to seek informal guidance include:

Intermediaries registered with SEBI under Section 12 of the SEBI Act, 1992 (e.g., stockbrokers, merchant bankers, portfolio managers)
Listed companies
Companies seeking to list securities that have filed a listing application or draft offer document
Mutual fund trustee companies and asset management companies (AMCs)
Acquirers or prospective acquirers under SEBI (SAST) Regulations, 2011

Confidentiality Provisions

Applicants may request that their application and SEBI’s response remain confidential for up to 90 days from the date of the response. If confidentiality is denied, the applicant is notified and may withdraw the request within 30 days. Upon withdrawal, no response is issued and the correspondence remains private.

Exclusions and Grounds for Rejection

SEBI does not entertain requests that:

Are based on hypothetical or general scenarios
Do not involve a direct or proximate interest of the applicant
Lack sufficient factual or legal clarity
Relate to matters under investigation or litigation
Have previously received similar guidance from SEBI

Additionally, if guidance is found to have been obtained through fraud or misrepresentation, SEBI may declare the letter void.