The Securities and Exchange Board of India (Sebi) has proposed a comprehensive overhaul of its online dispute resolution framework to enhance investor grievance redressal efficiency. According to reports from Mint, the regulator aims to make the system faster, more accountable, and easier to navigate for market participants. The proposed changes would shift administration of conciliation and arbitration from private ODR institutions to stock exchanges, depositories, and other market infrastructure institutions. Sebi's proposals would reshape how the system is administered, how arbitrators are appointed, the timelines for proceedings and the enforcement of arbitral awards.
Under the new framework, conciliation and arbitration administration would move from private ODR institutions to market infrastructure institutions (MIIs) such as stock exchanges, depositories, and clearing corporations. As reported by Mint, these institutions are better positioned to oversee the process because they already supervise most market intermediaries and listed entities. Investors will gain a larger role in selecting arbitrators from approved panels, with unresolved SCORES complaints moving directly to conciliation to reduce delays. Conciliation will remain free for investors, while appellants must deposit award amounts. The regulator said these institutions are better placed to oversee the process because they already supervise most market intermediaries and listed entities.
The existing ODR framework, introduced in 2023, enables conciliation and arbitration to be conducted entirely online. According to Mint reports, the mechanism comes into play only after an investor's complaint remains unresolved through Sebi's SCORES grievance redressal platform. If conciliation fails, disputes proceed to arbitration, where awards can be challenged in court. The current ODR institutions include the Centre for Online Resolution of Dispute (CORD), Centre for Alternate Dispute Resolution Excellence (CADRE), Webnyay, Presolv360, Sama, Just Act and Jupitice. Industry participants said investors often preferred independent arbitration institutions over the ODR framework because of operational bottlenecks, as these are neutral bodies that administer disputes outside the court system.
Industry participants have broadly welcomed the proposals, addressing operational shortcomings in the existing system. As reported by Mint, the changes could improve arbitration award enforcement and encourage wider use of the ODR framework. For investors, the reforms promise quicker resolution through defined timelines, continued access to free conciliation, and stronger safeguards. The revised framework would also permit interim relief and require entities appealing awards to deposit the full amount, with investors potentially receiving up to ₹5 lakh or 50% of the award value while an appeal is pending. The new framework is expected to reduce delays and improve accountability in the dispute resolution process.
Market participants have identified areas for further framework strengthening, particularly for disputes involving overseas parties. According to Mint reports, concerns have been raised about the quality, independence, and specialised expertise of arbitrators. Experts have recommended widening the arbitrator pool, introducing specialised training programmes, and creating dedicated grievance redressal provisions for foreign entities. Under Sebi's proposal, conciliators and arbitrators should be between 40 and 75 years of age, have at least 10 years' experience in finance, law or related fields, and possess sound understanding of securities markets. The proposals were developed after feedback from market participants, who flagged delays in appointing and paying conciliators and arbitrators, lengthy proceedings, and weak enforcement of arbitration awards.
