Employees of depository participant entities not to be considered as DP

Employees of depository participant entities not to be considered as Depository Participant or their associate under SEBI (D&P) Regulations 2018

CIRCULAR

SEBIIHO/MRD/ DOP2-DSA2/CIR/ P/2019/22                               

January 23, 2019

To
All Depositories,

Dear Sir / Madam,

Sub: Clarifications in SEBI (Depositories and Participants) Regulations, 2018

SEBI, vide notification dated October 03, 2018 , issued Securities and Exchange Board of India (Depositories and Participants) Regulations , 2018 [SEBI (D&P) Regulations, 2018].

2.  Stock  Exchanges, Depositories , Public  Financial  Institutions and  Public Sector  Banks  had sought  certain  clarifications  from  SEBI with regard  to the applicability of Regulation 24 (9) and  Regulation  24  (10)  of  SEBI   (D&P) Regulations , In this regard, it is clarified that:

(i) For the purpose of Regulation 24 (9) and Regulation 24 (10) of SEBI (D&P) Regulations 2018, a recognized clearing corporation shall not be considered as a Depository Participants.

(ii) For the purpose of 24(10) of SEBI (D&P) Regulations 2018 , in addition to the directors, employee/s of entities mentioned in Regulation 24 (10) shall not be considered as Depository Participant or their associate.

3. In view of the above, Depositories are directed to:

(i) take necessary steps to put in place systems for implementation of the circular , including necessary amendments to the relevant bye-laws, rules and  regulations;

(ii) bring the provisions of this circular to the notice of the depository participants I other market participants and also disseminate the same on their website;

(iii) communicate to SEBI the status of implementation of the provisions of this circular through monthly development report.

4. This circular is being issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act , 1992,read with Section 19 of the Depositories Act, 1996 in the interests of investors in securities and to promote the development of, and to regulate the securities market.

5. This circular is available on SEBI website at www.sebi.gov.in at “Legal Framework—+Circulars “.

Yours faithfully ,

Bithin Mahanta
Deputy General Manager
email : bithinm@sebi.gov.in