The Securities Exchange Board of India (SEBI) will now be sending its summons and show cause notices on instant messaging channels as well as other methods of electronic and physical delivery. The regulator is going to adopt instant messaging apps like WhatsApp and Telegram, both of which are wildly popular in India, to start supplementing its normal methods of communications, reported The Economic Times.
The change has been predicated on the hassle of sending physical summons and notices during times of movement restrictions and lockdowns. This has often led to the intended recipients managing to dodge the official communications. On top of instant messaging, the market regulator will also send its official communications through the means of electronic mail, registered post, courier and fax.
"The law and regulation concerning the securities market and the regulatory framework continues to see dynamic changes from time to time. In an effort to smoothen the system of adjudication and issuance of timely processes, the manner of service of notices and orders has also undergone changes to meet with the needs of time," Zerick Dastur, Founder of Zerick Dastur, advocates and solicitors, told ET.
While the legality of the usage of electronic communications and legal notices sent through instant messaging apps was questioned, the Supreme Court, in principle, agreed to the legality of such practices. The bench of then Chief Justice S.A. Bobde, and Justices R.S. Reddy and A.S. Bopanna, along with inputs from Attorney General K.K. Venugopal and Solicitor General Tushar Mehta, had agreed with the notion that electronic form of communication like emails, instant messaging apps, and other future developments would be considered legally valid for sending judicial notices and summons.
With the Indian securities market operating in a near-complete demat environment, the KYC (know-your-customer) information of clients, which includes their names and phone numbers, is stored safely with intermediaries and can thus be easily accessed by the SEBI upon request and need.
(Edited by : Shoma Bhattacharjee)