“PART – A”
RECENT REQUIREMENTS FROM AUGUST 28, 2015 TO June 30, 2016
Item 1- CONSTITUENT REGISTRATION
Item No. Subject SEBI circular No. /Download
No.
1.1 Know Your Client Requirements - Download Ref.No.:
Clarification on voluntary adaptation of NSE/INSP/31629 dated
Aadhaar based e-KYC process January 25, 2016
SEBI circular
CIR/MIRSD/29/2016 dated
January 22, 2016;
Download Ref.No.:
NSE/INSP/31977 dated March
15, 2016
Item 2 - DEALING WITH INTERMEDIARIES
Item No. Subject SEBI circular No. /Download
No.
2.1 Tagging/Flagging of Demat /Bank Download Ref. No.:
accounts of trading / clearing members NSE/INSP/31912; dated
March 07, 2016.
2.2 Indicative Penalty for Non-submission / Download Ref. No.:
Delayed submission of Risk Based NSE/INSP/31996; dated
Supervision (RBS) data March 17, 2016
Item 3- DEALING WITH CLIENTS
Item No. Subject SEBI circular No. /Download
No.
3.1 Updation of E Mail IDs and Mobile Download Ref.No.:
Numbers of retail clients NSE/INSP/32471 dated May
31, 2016
Item 4- CONTRACT NOTES
Item No. Subject SEBI circular No. /Download
No.
4.1 Signature on Physical Contract Notes Download Ref.No.:
NSE/INSP/32524 dated June
06, 2016
RECENT REQUIREMENTS FROM AUGUST 25, 2015 TO June 30, 2016
Item 1
CONSTITUENT REGISTRATION
(1.1) Know Your Client Requirements - Clarification on voluntary adaptation of Aadhaar
based e-KYC process
This has reference to the Exchange circular NSE/INSP/21465 dated August 13, 2012 (SEBI
circular CIR/MIRSD/09/2012 dated August 13, 2012), regarding admissibility of Aadhaar
Letter issued by UIDAI as a Proof of Address; and Exchange Circular NSE/INSP/24676 dated
October 08, 2013 (SEBI circular CIR/MIRSD/09/2013 dated October 08, 2013) regarding
acceptance of e-KYC service launched by UIDAI as a valid process for KYC verification,
provided the client has authorized the intermediary to access his data through UIDAI
system.
Further to the above, SEBI has issued circular no. CIR/MIRSD/29/2016 dated January 22,
2016 regarding clarification on voluntary adaptation of Aadhaar based e-KYC process.
(Download Ref. No.: NSE/INSP/31977; Circular Ref No.: 271/2016 dated March 15, 2016).
This has reference to the Exchange circular NSE/INSP/31629 dated January 25, 2016 (SEBI
circular CIR/MIRSD/29/2016 dated January 22, 2016) on the captioned subject.
In this regard, SEBI has issued FAQ’s on "Know Your Client Requirements - Clarification on
voluntary adaptation of Aadhaar based e-KYC process". The same is available at:
http://www.sebi.gov.in/cms/sebi_data/attachdocs/1459847239344.pdf
Item 2
DEALINGS WITH INTERMEDIARIES
(2.1) Tagging/Flagging of Demat /Bank accounts of trading / clearing members
(Download Ref. No.: NSE/INSP/31912; Circular Ref No.: 270/ 2016 dated March 07, 2016.)
This has reference to Regulation 6.1.5 (f) of Part A of the NSEIL Capital Market Regulations
and Regulation 6.1.6.2 (v) of NSEIL Futures & Options Segment requiring Members to keep
the dematerialised securities of Constituents in a separate beneficiary account distinct from
the beneficiary account maintained for holding their own dematerialised securities. For this
purpose, every Trading Member is required to open a beneficiary account in the name of
the Trading Member exclusively for the securities of the Constituents.
Exchange vide its Circular NSE/INSP/9090 dated June 28, 2007 had brought to the attention
of the Members regarding a facility offered by NSDL & CDSL for tagging of demat accounts
as ‘client margin account’ or ‘client beneficiary account’ to hold client securities and in order
to differentiate them from the Member’s own beneficiary accounts.
In order to ensure proper segregation of client securities and clear demarcation of demat
accounts used for client purposes, Members are hereby directed to ensure that all their
demat accounts used for holding clients securities are compulsorily flagged as “client margin
account’ or ‘client beneficiary account’ in the respective depositories by April 30, 2016.
Members’ attention is also drawn to SEBI circular SMD/SED/CIR/93/23321 dated November
18, 1993 requiring every member holding client money to have a separate account at bank
in the name of the member in the title of which the word "clients" shall appear. Accordingly,
Members are also required to ensure that the word “Client Account” is mentioned /
incorporated in the Bank accounts maintained for holding client funds.
Trading Members shall be required to inform the Exchange, the DP accounts flagged as
client margin account’ or ‘client beneficiary account and details of the client Bank accounts
which shall be periodically updated as and when there is any change. The process of
reporting the details to the Exchange shall be informed in due course.
https://www.nseindia.com/content/circulars/INSP31912.pdf
(2.2) Indicative Penalty for Non-submission / Delayed submission of Risk Based
Supervision (RBS) data
(Download Ref. No.: NSE/INSP/31996; Circular Ref. No.: 272/2016 dated March 17, 2016)
This has reference to Risk Based Supervision (RBS) framework formulated by SEBI in
consultation with Stock Exchanges wherein Members are required to submit
data/information to the Exchange.
Stock Exchanges, in consultation with SEBI, have jointly formulated a standard penalty
structure for the non / delayed submission of RBS data/information which shall be
applicable from March 31, 2016 submission and onwards. The details of the same are
enclosed as Annexure-A for your reference.
All members are required to ensure that they submit the RBS data within the prescribed
timelines in the prescribed format in order to avoid any late / non-submission penalty /
disciplinary actions.
https://www.nseindia.com/content/circulars/INSP31996.zip
Item 3
DEALINGS WITH CLIENTS
(3.1) Updating of E Mail IDs and Mobile Numbers of retail clients
(Download Ref. No.: NSE/INSP/32471; Circular Ref No.: 279/ 2016 dated May 31, 2016.)
This has reference to SEBI circular CIR/MIRSD/15/2011 dated August 02, 2011, Exchange
circulars NSE/INVG/21841 dated October 4, 2012, NSE/INSP/27339 dated August 12, 2014
and NSE/INSP/27368 dated August 18, 2014 regarding updation of E-mail IDs and mobile
numbers of clients. The following points should be ensured by the members while
implementing the above circulars:
1. Separate mobile number/E-mail address shall be uploaded for each client. The stock
broker may, at the specific written request from client, upload the same mobile number/E-
mail address of one of the client’s family member. ‘Family’ for this purpose would mean self,
spouse, dependent children and dependent parents.
2. Mobile numbers/e-mail addresses of member’s employees/sub-brokers/authorized
persons should not be uploaded as mobile number or E mail ID of the client.
3. For all existing clients, member should collect their e mail IDs & mobile numbers and
upload the same to Exchange before executing any fresh transaction for that client.
4. In cases where investors do not have mobile number/email id, member shall obtain a
declaration from the client to this effect and report the same in UCI online by entering
‘notprovided@notprovided.com’ in the email field and ‘6666666666’ in the mobile number
field.
5. Where members are unable to get the details from their existing clients, Members are
advised to retain verifiable records of seeking details of email Id and mobile number for
such clients. However no fresh trade can be done for such client unless the E mail ID &
mobile number is collected and uploaded in UCI or declaration as stated at point no. 4
above is obtained.
6. The E mail and mobile number details of the clients should not be kept blank in the UCI
online database. All members are requested to strictly adhere to the aforementioned
requirements and exercise due diligence while uploading the E mail ID and mobile numbers
declared by their clients to the UCI online of the Exchange.
https://www.nseindia.com/content/circulars/INSP32471.pdf
Item 4
ISSUE OF CONTRACT NOTES
(4.1) Signature on Physical Contract Notes
(Download Ref. No.: NSE/INSP/32524: Circular Ref No.: 280/ 2016 dated June 06, 2016.)
This has reference to Exchange circular NSE/INSP/27155 dated July 16, 2014 regarding
clarification on common contract note. It is clarified that Members may affix facsimile
signatures (scanned signature) on physical contract notes issued to their clients after
ensuring that adequate controls and procedures are put in place regarding the use of
facsimile/scanned signatures.
Members opting to use this facility should have a well-documented policy regarding its use
which shall be implemented after appropriate approval from board (in case of corporates),
partners (in case of partnership firms) or proprietor (in case of sole proprietorship firm) as
the case may be. The policy should clearly specify the procedure to be adopted for its use,
the controls in place and procedure to be followed in case of any change of authorized
signatories. The authorized signatories should necessarily be approved by the
Board/Partners/proprietor for use on the contract notes. In case, an authorized signatory
whose signature was used for the above purpose, no longer holds that position with the
Member, then the use of his signature shall not be permitted on the contract notes under
any circumstances beyond the date from which the person ceases to hold the office.
Any contract note issued with facsimile/scanned signature shall be deemed to have been
signed by the authorized signatory notwithstanding any misuse of facsimile/scanned
signature and the ultimate responsibility to prove its genuineness shall vest with the
Member.
https://www.nseindia.com/content/circulars/INSP32524.pdf
