Description

NSE updates the process for filing review, appeal or waiver of penalty requests against actions taken by the Exchange and Member Committee, implementing new Review Panel mechanism for post-MC appeals.

Summary

NSE has updated the process for handling review, appeal or waiver of penalty requests filed by trading members against actions taken by the Exchange and Member Committee (MC). The circular introduces a new Review Panel mechanism comprising Public Interest Directors and/or Independent External Professionals for reviewing decisions taken by the Member Committee after September 19, 2025. Requests against Exchange actions continue to be handled by the Member Committee, while requests against MC decisions will now be handled by the Review Panel.

Key Points

  • Review requests against Exchange actions (per pre-approved policy) continue to be placed before Member Committee
  • New Review Panel mechanism established for reviewing Member Committee decisions taken after September 19, 2025
  • Review Panel comprises Public Interest Directors and/or Independent External Professionals not part of MC
  • All review requests must be filed within 45 days from date of Original Order/Original Action Letter
  • Non-refundable processing fee of Rs. 10,000 + GST per review request
  • Processing fees credited to NSE Investor Protection Fund Trust
  • Review requests must be supported by complete documentary evidence
  • Requests without adequate evidence or filed after 45 days will not be considered

Regulatory Changes

Implementation of SEBI circular dated August 05, 2025 requiring establishment of Review Panel mechanism. The Review Panel becomes applicable for review cases received against MC actions taken in meetings held after September 19, 2025 (45th day from SEBI circular issuance). This separates the review process into two distinct pathways:

  1. Exchange action reviews → Member Committee
  2. Member Committee action reviews → Review Panel (new mechanism)

Compliance Requirements

  • Trading members must file review, appeal or waiver requests within 45 days from date of Original Order/Original Action Letter
  • Requests must be submitted through NSE Member Portal at https://enit.nseindia.com/MemberPortal/
  • Complete documentary evidence must accompany all review requests
  • Payment of non-refundable fee of Rs. 10,000 + GST required per review request
  • Members should follow the process detailed in Annexure-A: login to member portal → select ‘Inspection’ service → navigate to ‘Penalty’ tab → select ‘Penalty Dashboard’
  • Queries regarding review requests should be sent to dl-insp-enforcement@nse.co.in with subject line format: “Query_Review Request_Case ID_TM Name”

Important Dates

  • Circular Date: October 8, 2025
  • SEBI Circular: August 05, 2025
  • Review Panel Implementation: Applies to MC meetings held after September 19, 2025
  • Review Request Deadline: Within 45 days from date of Original Order/Original Action Letter
  • Reference Circular: NSE/INSP/69613 dated August 12, 2025

Impact Assessment

The circular has moderate impact on trading members’ penalty review processes. The introduction of the Review Panel creates an independent mechanism for reviewing Member Committee decisions, potentially providing more objective oversight. The mandatory 45-day filing deadline and Rs. 10,000 + GST fee requirement may encourage members to carefully evaluate merit before filing reviews. The separation of review pathways (MC for Exchange actions vs Review Panel for MC actions) creates a clearer governance structure. Members need to update internal compliance processes to align with the new timelines and filing procedures. The measure aligns with SEBI’s broader governance reforms while maintaining member protection mechanisms.

Impact Justification

Procedural update affecting trading members' ability to appeal penalties, introduces new Review Panel mechanism but does not change fundamental penalty structure or trading operations