BNP Paribas Pays Rs39.97 Lakh To Settle SEBI Proceedings over FPI Regulation Violations
Moneylife Digital Team 11 November 2025
Corporate and institutional banking, investment banking and sustainable finance services provider BNP Paribas has paid Rs39.97 lakh to settle adjudication proceedings initiated by market regulator Securities and Exchange Board of India (SEBI). The settlement stems from allegations that the company violated several provisions of the SEBI Foreign Portfolio Investors (FPI) Regulations 2014 and 2019 in its role as a designated depository participant (DDP).
 
SEBI had initiated proceedings under Section 15-I of the SEBI Act, 1992, alleging that BNP Paribas granted Category II licences to six FPIs that were not eligible under the 2014 regulations.
 
The regulator also stated that the company failed to identify that these FPIs were not regulated by the UK-FCA during their conversion, yet they were incorrectly re-categorised as Category I under the 2019 regulations.
 
In addition, SEBI observed that BNP Paribas granted a Category I registration to another FPI that did not meet eligibility criteria under the FPI Regulations, 2019.
 
A show-cause notice (SCN) dated 25 February 2025 detailed these alleged lapses and asked BNP Paribas to explain why a penalty should not be imposed under Section 15HB of the SEBI Act, 1992.
 
While the adjudication proceedings were underway, BNP Paribas filed a settlement application under the SEBI (Settlement Proceedings) Regulations, 2018, seeking to resolve the matter without admitting or denying SEBI’s findings.
 
SEBI internal committee (IC) held a meeting on 6 June 2025 and calculated an indicative settlement amount of Rs39.97 lakh. Although BNP Paribas requested that a reduced amount of Rs29.25 lakh be considered, the IC rejected this as the submissions related to the merits of the case.
 
The company later submitted revised settlement terms offering the full indicative amount of Rs39.97 lakh which was then examined by the high-powered advisory committee (HPAC) on 24 July 2025 and subsequently approved by SEBI’s whole-time members (WTM) in September 2025.
 
On 27 October 2025, BNP Paribas remitted the settlement amount, after which SEBI formally disposed the adjudication proceedings. 
 
The regulator, however, clarified that the settlement order may be reopened if the company is later found to have withheld disclosures, violated undertakings, or if discrepancies arise in the settlement terms.
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