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The Securities and Exchange Board of India has brought into force its new settlement mechanism on November 7, 2026, overhauling the process for resolving administrative and civil proceedings. The framework, formally notified on October 8, 2026, as the SEBI Settlement of Administrative and Civil Proceedings Regulations, 2026, supersedes the previous regulations introduced in 2018 while preserving transitional and savings provisions for ongoing matters. Under the revised norms, eligible individuals and corporate entities can settle regulatory enforcement actions through an online application portal. To streamline the procedure, the capital markets regulator has introduced digital support tools, including a dedicated settlement amount calculator, an extensive repository of frequently asked questions, an explanatory video guide, and an operational helpdesk.
Tiered fee structure and calculation parameters for consent terms
The updated regulations establish non-refundable application charges categorized by the legal status of the applicant. Individual natural persons must remit an application fee of ₹25,000, whereas corporate bodies and other non-individual applicants are required to pay ₹35,000. These application charges remain non-refundable even if the settlement plea is ultimately declined by the regulator. The total settlement amount will be computed through a structured formula based on a baseline sum, the operational stage of regulatory proceedings, past enforcement history, the gravity of the alleged statutory breach, and other mitigating or aggravating factors.
Under the financial benchmarks laid down in the framework, a first-time applicant faces a minimum settlement amount of ₹3 lakh. For other categories of applicants, the baseline threshold is fixed at a minimum of ₹7 lakh. In terms of filing deadlines, applicants dealing with pending matters before the board must submit their settlement papers within 90 days of receiving a show-cause notice or supplementary show-cause notice, calculated from whichever notice was issued later. However, this 90-day limitation does not apply to certain specified proceedings pending before the Securities Appellate Tribunal or the Supreme Court.
Exclusions for fraudulent misconduct and expedited tracks for minor violations
The regulatory framework expressly excludes serious market offenses and specific categories of violators from seeking consensual resolution. Cases involving willful default, fraudulent borrowing, and fugitive economic offenders are barred from the settlement mechanism. The regulator has also restricted settlements in matters that exert a market-wide impact, cause extensive financial distress to retail investors, or compromise the broader integrity, fairness, and credibility of the securities market.
Conversely, the regulator has introduced an expedited fast-track route to resolve minor infractions without protracted proceedings. This fast-track framework covers matters where the determined settlement sum does not exceed ₹10 lakh, provided the case requires neither the disgorgement of illegal gains nor the imposition of corrective regulatory directions. This streamlined mechanism is designed to resolve procedural lapses swiftly while reducing administrative strain on enforcement infrastructure.
Confidentiality protections and institutional review panels
To assist ongoing inquiries, the framework incorporates provisions for confidential settlements available to entities offering substantial cooperation during audits, inspections, investigations, or other regulatory examinations. Submitted settlement applications will undergo multi-layered administrative review, beginning with an Internal Committee and an High Powered Advisory Committee. These committees evaluate the terms and submit formal recommendations, which are placed before a panel of whole-time members of the board to make the final determination on acceptance or rejection.
