SEBI Settlement Regulations 2026 Take Effect; Online Filing, Fast Track

The new SEBI settlement regulations came into force on November 7, 2026, with the market regulator launching an online filing facility and a settlement amount calculator for entities looking to settle enforcement cases.

The Securities and Exchange Board of India (SEBI) announced the start date in a press release dated November 6. The SEBI (Settlement of Administrative and Civil Proceedings) Regulations, 2026 were notified on October 8 and replace the 2018 framework, subject to transitional provisions.

Alongside the online facility, SEBI has published FAQs, set up a help desk and released an explanatory video on how settlement amounts are calculated. The regulator said eligible persons may apply for settlement in accordance with the new regulations.

SEBI settlement regulations: fees, minimum amounts and deadlines

Under the new rules, the non-refundable application fee is ₹25,000 for individuals and ₹35,000 for other applicants. The minimum settlement amount is ₹3 lakh for first-time applicants and ₹7 lakh for others.

The final amount is worked out from a base amount adjusted for the stage of proceedings, the applicant’s prior regulatory record, the seriousness of the default and any aggravating or mitigating factors. Applicants can estimate it using SEBI’s online settlement amount calculator.

An application must generally be filed within 90 days of a show-cause notice or supplementary show-cause notice, whichever is later, and within 60 days of receiving a settlement notice issued before any show-cause notice. For proceedings already pending on November 7 where no application was filed, or where an application under the 2018 rules was rejected, returned or withdrawn, an application must be filed within 90 days of the new regulations taking effect, a window that runs to early February 2027.

Once SEBI’s panel accepts a settlement, a demand notice is issued within 10 days. The applicant then has 30 days to pay, which can be extended by up to 30 days with a 1% increase in the settlement amount.

How fast-track settlement works

The framework introduces two fast-track routes. The violation-based route covers certain lapses such as delayed disclosures and late filing of returns. An applicant has 30 days from receiving a fast-track notice to apply, extendable by 15 days.

The monetary-threshold route applies where the settlement amount is up to ₹10 lakh and no disgorgement or remedial and regulatory terms are needed.

Regular applications are first examined by an Internal Committee of SEBI officials. They then go to a four-member High Powered Advisory Committee, which includes a former Supreme Court or High Court judge and three external experts, before a panel of two or more whole-time members takes the final decision.

Who cannot settle, and what it means for companies

Wilful defaulters, fraudulent borrowers and fugitive economic offenders are barred from the route. SEBI may also decline settlement where a default has had a market-wide impact, caused losses to a large number of investors or affected market integrity, unless the terms can adequately remedy the harm.

Applicants who substantially assist SEBI in an examination, investigation, inspection or audit may receive confidentiality benefits, subject to conditions. In cases involving diverted or siphoned funds, the full amount must be returned with interest before settlement is sought, according to Outlook Money.

Cases already in process get a choice. Where the advisory committee has already made a recommendation but SEBI’s panel has not yet approved it, the applicant has 30 days from receiving SEBI’s notice to decide whether to proceed on the amount recommended under the 2018 rules or seek fresh processing under the 2026 regulations.

For listed companies, promoters, directors and market intermediaries, the SEBI settlement regulations offer a quicker and more predictable way to close procedural lapses without prolonged litigation. The fixed filing windows, however, mean compliance and legal teams will have to assess show-cause notices and decide on settlement promptly.

The requirement to return diverted funds and the bar on cases with market-wide impact indicate that settlement will not be an easy exit in serious matters. Entities with cases already pending before SEBI will need to act within the 90-day transition window to use the new framework.

The rollout comes alongside other regulatory moves in financial markets, including the RBI’s new Financial Markets Committee and the central bank’s 25 basis point repo rate hike to 5.5% in October. More regulatory and corporate coverage is on our Business News page.