‘Anonymous’ seeks internal documents on Options regulation, Sebi declines sharing saying it will reveal the ‘mind of regulator’
The Securities and Exchange Board of India (Sebi) has refused a Right to Information (RTI) request seeking internal documents related to its regulation of Options trading on the ground that the disclosure would reveal the ‘mind of the regulator’ and undermine its decision-making process.
The anonymous RTI applicant had sought details of all Sebi circulars, guidelines, and notifications related to Options trading issued between August 1, 2024 and July 31, 2025.
The RTI had sought the objectives or rationale mentioned in file notes, copies of internal communications, directions or advice received from the Finance Ministry or any government body, and information on whether public or stakeholder consultations had been conducted. The applicant also requested details of any impact analysis carried out before or after the regulatory changes.
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However, Sebi declined to share the internal communications, arguing that these documents reflect the subjective views of various officials involved in policymaking and contain confidential strategic deliberations. The Sebi order noted that as the regulator of the securities market, Sebi issues circulars and guidelines on market activity and regularly revisits prevailing procedures and systems to improve processes or respond to emergent situations.
The appellate authority’s order said, “Disclosure of file notings, communications with respect to the policy decision-making process of Sebi would lead to revealing the mind of the regulator. Further, disclosure of such information may also expose strategies or actions contemplated by Sebi in the future, which are strategic in nature.”
Sebi explained that the requested information could include inputs received and deliberations conducted, and identities of persons involved in the formulation of circulars – all of which are strategic and confidential. Disclosure could affect Sebi’s ability to obtain future inputs and may also contain sensitive third-party information.
The order also cautioned that such disclosures might reveal alternative interpretations of specific legal provisions, their possible market consequences, and strategies designed to counter attempts to circumvent regulations. Revealing such strategies could compromise not only the stability of the securities market, but also India’s broader economic interests.
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Though RTIs cannot be filed anonymously, as basic details are required while filing, but some platforms provide facility to file such requests where names of the information seeker is not disclosed.
Sebi’s Steps to Tackle F&O Frenzy
The capital market regulator has been actively seeking to curb the growing frenzy around Futures and Options (F&O), particularly the excessive focus on Options trading. Since July 2024, the regulator has been engaged in internal discussions on tackling this challenge.
On October 1, 2024, Sebi announced several key measures, including, upfront Collection of Option Premium from option buyers to prevent excessive leverage. Removal of Calendar Spread Treatment on Expiry Day to ensure fair market practices. Intraday Monitoring of Position Limits to track and curb excessive positions. Increased Tail Risk Coverage by imposing an additional Extreme Loss Margin (ELM) of 2 percent.
In May 2025, Sebi introduced a comprehensive set of reforms – F&O 2.0 – to improve structural controls in the derivatives market. Key measures were: Delta-Based Open Interest Limits for better alignment with market risk, revised Market-Wide Position Limits (MWPL) to prevent concentration of positions, stricter position creation rules during ban periods for single stocks, and intraday monitoring of MWPL Utilization in single stocks.
Among other measures initiated by the Sebi to improve F&O segment include: position limits for index futures and options, pre-open for derivatives, and individual entity-level position limits for single stocks.
Most recently, through a circular issued on September 1, 2025, Sebi introduced a new framework to monitor intraday positions in index options. Starting October 1, 2025, each trading entity will be allowed a maximum intraday net futures -equivalent position of Rs 5,000 crore in index options, compared to the existing end-of-day cap of Rs 1,500 crore. This measure is designed to strengthen market transparency and risk management.