"Transparency in capital markets is a regulatory, not judicial, function." Examine this in light of the Supreme Court's refusal to order public disclosure of beneficial owners of AIFs and FPIs.

In October 2026, a three-judge Supreme Court Bench refused to direct SEBI to require public disclosure of the ultimate beneficial owners (UBOs) of AIFs and FPIs. It held that a mandamus needs an existing "legal framework of regulations" [1]. The statement largely holds, but regulatory primacy does not mean the regulator is beyond accountability.

Why transparency is primarily a regulatory function

• Technical calibration: SEBI's 24 August 2023 circular requires disclosure that looks through to natural persons. It applies to FPIs with >50% of equity AUM in one corporate group or above a size threshold [2]. SEBI's Board later proposed raising that threshold from ₹25,000 crore to ₹50,000 crore [3]. Courts are poorly placed to weigh such market-flow trade-offs.
• Limits of mandamus: a writ can only enforce a pre-existing legal duty, and no rule yet requires public disclosure [1].
• Settled restraint: in Vishal Tiwari (Adani–Hindenburg, 2024), the Court said it would not substitute its own wisdom for SEBI's policy choices. It also refused to undo SEBI's FPI amendments [4].
• Separation of powers: the Bench asked why an MP had used Article 32 instead of raising the issue in Parliament [1].

Why the judiciary cannot be wholly absent

• Regulators can dilute their own rules: the Court was told that the words "opaque structure" were deleted from the FPI Regulations in 2019 [4].
• Accountability gap: if the regulator never creates a duty, nobody can go to court to enforce one. The Court's own test leaves this gap open.
• Constitutional check: courts remain the safeguard against arbitrary action under Article 14.
• Dialogic nudge: the Court asked the Centre and SEBI to consider transparency Regulations [1]. This is a nudge, not a takeover of policy.

Way forward

• Tiered access: IMF guidance describes a model where the public sees the owner's name and country, while authorities see full details [5]. This balances privacy with scrutiny by outsiders.
• Public consultation by SEBI: any easing should keep the look-through to natural persons [2] and change only who is covered.
• Parliamentary oversight of SEBI through committees and questions.

Overall, the regulator should write transparency rules, while SEBI, Parliament and the courts share the work of holding it to them. A tiered disclosure framework would answer the Court's call and protect minority shareholders. It would also advance SDG 16.6, which calls for accountable and transparent institutions.