SEBI may revisit analyst fee unbundling; short selling, SLB and derivatives oversight under review: Sources

The Securities and Exchange Board of India (SEBI) is reassessing its proposal to unbundle analyst fees from broking charges, amid industry feedback that similar reforms in London and Europe yielded limited success.Sources indicated that SEBI is open to reversing the move if outcomes in the domestic market prove unsatisfactory.

The regulator is expected to take up amendments to the Stock Broker Regulations, 1992 at its upcoming board meeting in December.

The proposed overhaul aims to eliminate regulatory overlaps, ease compliance requirements and bring greater clarity to existing rules.Simultaneously, SEBI is reviewing India’s short selling norms and the Stock Lending and Borrowing (SLB) framework.

Despite being in place since 2007, the Stock Lending & Borrowing Mechanism (SLBM) has seen subdued activity and is widely viewed as needing a structural upgrade to encourage broader participation.SEBI is also closely monitoring Futures & Options (F&O) data as it considers any further policy action in the derivatives segment.

Sources emphasised the need for a calibrated approach to derivatives regulation, noting that any changes must balance market development with investor protection.

Further clarity is expected after the SEBI board meets next month.

Earlier, speaking at CNBC-TV18’s Global Leadership Summit 2025, SEBI Chairman Tuhin Kanta Pandey said that the market regulator will be undertaking a comprehensive review of India’s short selling and SLB (Securities Lending and Borrowing) framework, both of which were introduced nearly two decades ago.

Introduced in 2008, the SLB framework was to facilitate short-selling, prevent settlement failures and the mechanism is being managed through clearing corporations.