Chapter IIIE — Joint Mechanism

Section 45Y: Joint Mechanism

Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026

Section 45Y establishes a joint mechanism for resolving differences of opinion or coordinating action where multiple financial-sector regulators have jurisdiction over a hybrid or overlapping instrument/activity, in the circumstances specified by the statute.

Operative provisionOfficial sources mappedProvision-specific decode

Finin2min - Section 45Y in 2 minutes

Legal effectSection 45Y establishes a joint mechanism for resolving differences of opinion or coordinating action where multiple financial-sector regulators have jurisdiction over a hybrid or overlapping instrument/activity, in the circumstances specified by the statute.

Operative ruleThe mechanism is intended for inter-regulatory coordination and does not erase the underlying statutes administered by each regulator.

Connected lawMap the product, entities and issues to each regulator's statutory remit before invoking the joint mechanism.

File evidenceMaintain a jurisdiction matrix, regulator correspondence, issue note and the joint-mechanism decision/action taken.

Statutory structure and clause / subsection decode

This map separates the operative limbs of this provision so thresholds, powers, conditions and exceptions are not collapsed into a single summary.

Scope

Operative limb

The mechanism is intended for inter-regulatory coordination and does not erase the underlying statutes administered by each regulator.

Legal boundary

Map the product, entities and issues to each regulator's statutory remit before invoking the joint mechanism.

Worked practical example

Facts. For a hybrid product combining securities and banking features, the adviser should identify the SEBI/RBI (and any other) statutory hooks first; Section 45Y is the coordination mechanism, not an independent product licence.

Compliance points and common mistakes

Do not decide the issue from the heading alone. Map the facts to the operative words of Section 45Y and to each relevant subsection, clause, proviso or explanation shown above.
Keep the statutory question separate from the operational overlay. Map the product, entities and issues to each regulator's statutory remit before invoking the joint mechanism.
Do not convert an exception, exemption or discretionary RBI/Government power into an automatic entitlement. Record the authority, conditions and effective date.
Where the provision is historical, omitted or repealed, state that status prominently and do not present it as a current compliance obligation.

Connected provisions and instruments

Section 45Y has no universal instrument dependency in this package. Add an RBI circular or direction only when its subject, entity and effective date cover the issue being analysed.

Questions and answers

What is the purpose of Section 45Y?

Joint Mechanism: Section 45Y establishes a joint mechanism for resolving differences of opinion or coordinating action where multiple financial-sector regulators have jurisdiction over a hybrid or overlapping instrument/activity, in the circumstances specified by the statute.

Which statutory limb should be checked first?

Scope - Section 45Y establishes a joint mechanism for resolving differences of opinion or coordinating action where multiple financial-sector regulators have jurisdiction over a hybrid or overlapping instrument/activity, in the circumstances specified by the statute.

What is the next legal boundary?

Operative limb - The mechanism is intended for inter-regulatory coordination and does not erase the underlying statutes administered by each regulator.

What record should support the conclusion?

Section 45Y file evidence: Maintain a jurisdiction matrix, regulator correspondence, issue note and the joint-mechanism decision/action taken.

Primary sources

Source control for Section 45Y: use the official consolidated RBI Act for the statutory text and footnotes, then separately reconcile any post-Finance Act 2022 amendment, commencement notification or RBI instrument relevant to the event date.