NOTICE
Dated : October 30, 2014
Trading
members are hereby informed that the Exchange has received a Circular from SEBI
vide Ref. No. CIR/MRD/DP/29/2014, October 21, 2014 regarding Modification of client codes of
non-institutional trades executed on stock exchanges (All Segments). The contents of the said Circular are
reproduced hereunder for information of trading members.
CIRCULAR
CIR/MRD/DP/29/2014 October 21, 2014
To All Stock exchanges and Clearing corporations,
All Stock brokers through stock exchanges.
Dear Sir / Madam,
Sub: Modification of client codes of
non-institutional trades executed on stock exchanges (All Segments)
SEBI had issued circular CIR/DNPD/6/2011
dated July 05, 2011 pertaining to client code modifications of
non-institutional trades on stock exchanges.
2.
Upon receipt of various representations from stock brokers and stock xchanges
to review the penalty structure specified in the aforementioned circular, it
has been decided to partially modify the circular as under: (i) Stock exchanges
may waive penalty for a client code modification where stock broker is able to
produce evidence to the satisfaction of the stock exchange to establish that
the modification was on account of a genuine error.
(ii)
Not more than one such waiver per quarter may be given to a stock broker for
modification in a client code. Explanation: If penalty wavier has been given
with regard to a genuine client code
modification from client code AB to client code BA, no more penalty waivers
shall be allowed to the stock broker in the quarter for modifications related
to client codes AB and BA.
(iii)
Proprietary trades shall not be allowed to be modified as client trade and
vice versa.
(iv) Stock exchanges shall submit a
report to SEBI every quarter regarding all such client code modifications where
penalties have been waived.
3. Stock exchanges shall undertake
stringent disciplinary actions against stock brokers who undertake frequent
client code modifications.
4. All other conditions as specified in
the SEBI Circular dated July 05, 2011 remain unchanged.
5.
Stock Exchanges and Clearing Corporations are directed to: a) take necessary
steps to put in place systems for implementation of this circular, including
necessary amendments to the relevant bye-laws, rules and regulations.
b)
bring the provisions of this circular to the notice of the stock brokers /
clearing members and also disseminate the same on their website;
c) communicate to SEBI the status of
implementation of the provisions of this circular.
6. This circular is being issued in
exercise of powers conferred under Section 11 (1) of the Securities and
Exchange Board of India Act, 1992 to protect the interests of investors in
securities and to promote the development of, and to regulate the securities
market.
Yours faithfully,
Maninder Cheema
Deputy General Manager
email: maninderc@sebi.gov.in
Trading
Members are requested to take note of the aforesaid guidelines of SEBI and act
accordingly.
M.A.V. Raju
General
Manager