On April 21, 2025, the Securities and Exchange Board of India (“SEBI”), issued the ‘Draft Circular on Amendments to the Master Circular on Online Resolution of Disputes (ODR) in the Indian Securities Market’ (“Draft Circular”).[1] Stakeholders and the general public, are invited to submit feedback latest by May 12, 2025.
I. Background
SEBI had earlier issued a circular dated July 31, 2023, titled ‘Online Resolution of Disputes in the Indian Securities Market’, which was subsequently amended on August 04, 2023, and December 20, 2023. These changes were later consolidated into the Master Circulars dated August 11, 2023, and December 28, 2023.
II. Key Proposed Amendments (as given in Annexure A of the Draft Circular)
- Direct Arbitration in Certain Cases (Clause 16(d), page 5): Introduces scenarios where disputes may directly proceed to arbitration, bypassing initial conciliation.
- Irrevocability of Consent in Conciliation (Clause 19, page 7): Provides that any consent given during conciliation shall be treated as irrevocable to prevent misuse or withdrawal.
- Separate Panels for Conciliators and Arbitrators (Clause 30(c), page 12): Mandates ODR institutions to maintain distinct panels for conciliators and arbitrators to ensure independence and specialization.
- Standard Operating Procedure (SOP) (New Clause 40A, pages 14–15): Incorporates broad procedural guidelines for effective implementation and transparency of ODR mechanisms.
[1] https://www.sebi.gov.in/reports-and-statistics/reports/apr-2025/draft-circular-for-public-comments-limited-relaxation-from-compliance-with-certain-provisions-of-the-sebi-listing-obligations-and-disclosure-requirements-regulations-2015_93498.html