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Bill to make FM a super regulator

business Updated: Jul 27, 2010 21:46 IST
HT Correspondent

The government on Tuesday introduced a Bill in the Lok Sabha that paves the way for setting up a joint mechanism to resolve differences among the various regulators in the financial sector and effectively makes the Finance Minister India’s super-regulator.

The Bill will turn into law an Ordinance that was promulgated last month, which gave IRDA the power to regulate unit linked insurance plans (ULIPs) that account for more than 50 per cent of life insurers’ business, and invest in equities.

It proposes a joint commission comprising the Finance Minister as Chairperson and RBI Governor as Vice Chairman, Secretary in the Department of Economic Affairs, Secretary (Financial Services) and Chairmen of regulatory bodies SEBI, IRDA, RBI and PFRDA as members.

The Bill deviates from the Ordinance in that in case regulators clash, the reference shall be made to the commission only by the regulator concerned and not by the government.