Executive Summary:
This circular from SEBI addresses nomination for eligible trading and demat accounts. It extends the timeline for existing account holders to submit nomination details or opt-out. The circular also relaxes certain requirements for existing investors and makes some previously mandatory fields in the nomination form optional. The new deadline for freezing accounts without nomination details is March 31, 2023.
Key Points / Main Content:
* **Background:**
* SEBI mandated nomination details or opt-out declarations for new trading and demat accounts opened on or after October 1, 2021.
* Existing account holders were initially required to provide this information by March 31, 2022, or face account freezes.
* **Timeline Extension:**
* The deadline for freezing accounts due to missing nomination details is extended to March 31, 2023.
* **Relaxations for Existing Investors:**
* Resubmission of nomination details is optional for existing investors who provided nomination details before the circular's issuance.
* Existing investors can submit nominations or opt-out via two-factor authentication (2FA) on platforms offering this service.
* **Nomination Form Changes:**
* Mobile number, email ID, and identification details of nominees/guardians are now optional in the nomination form.
* A revised nomination form is provided in Annexure A.
* **Other Provisions:**
* All other provisions from the original circular dated July 23, 2021, remain unchanged.
Impact Analysis:
* **Stock Exchanges and Depositories:**
* Impact: Required to amend relevant bylaws, rules, regulations, and operational instructions to implement the circular. Also, need to disseminate the circular's provisions to their constituents and on their websites.
* Action Required: Implement necessary amendments and disseminate information.
* **Stock Brokers/Trading Members and Depository Participants:**
* Impact: Need to be aware of the extended timelines, relaxed requirements, and changes to the nomination form. May need to update their systems to accommodate 2FA for nomination/opt-out.
* Action Required: Update systems and inform clients about the changes.
* **Investors (Existing and New):**
* Impact: Existing investors get an extended timeline to provide nomination details. Benefit from relaxed requirements and the option to use 2FA. New investors continue to have the option to nominate or opt-out.
* Action Required: Existing investors should submit nomination details or opt-out before March 31, 2023, if they haven't already. New investors must choose to nominate or opt-out when opening accounts.
Key Entities Referenced
Securities and Exchange Board of India (SEBI): The regulatory body for securities markets in India, responsible for protecting investors and regulating the securities market.
Recognized Stock Exchanges: Stock exchanges in India that are recognized by SEBI.
Recognized Depositories: Depositories in India that are recognized by SEBI, such as NSDL and CDSL.
Trading Members: Entities that are members of recognized stock exchanges and are authorized to trade on behalf of investors.
Depository Participants: Agents of depositories through which investors can hold securities in dematerialized form.
SEBIHOMIRSDRTAMBCIRP2021601: Circular number issued by SEBI on July 23, 2021, related to nomination details for trading and demat accounts.
Securities and Exchange Board of India Act, 1992: The law that established SEBI and defines its powers and functions.
Aradhana Verma: Deputy General Manager at Securities and Exchange Board of India (SEBI), Market Intermediaries Regulation and Supervision Department.
CIRCULAR
SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2022/23 February 24, 2022
To
All Recognized Stock Exchanges
All Recognized Depositories
Stock Brokers (Trading Members) through Recognized Stock Exchanges
Depository Participants through Depositories
Dear Sir/Madam,
Subject: Nomination for Eligible Trading and Demat Accounts – Extension of
timelines and relaxations for existing account holders
1. SEBI, vide circular no. SEBI/HO/MIRSD/RTAMB/CIR/P/2021/601 dated July 23,
2021 had mandated submission of nomination details/declaration for opting out of
nomination for investors opening new trading and or demat account(s) on or after
October 01, 2021. The circular also prescribed mandatory furnishing of the
aforesaid information for all existing eligible trading and demat account holders.
2. Para 2 of the said circular reads as follows:
“Investors opening new trading and or demat account(s) on or after October 01,
2021, shall have the choice of providing nomination or opting out nomination, as
follows;
a. The format for nomination form is given in Annexure –A to this circular
b. Opt out of nomination through ‘Declaration Form’, as provided in Annexure –
B to this circular”
Further, para 7 of the said circular reads as follows:
“Further, all existing eligible trading and demat account holders shall provide
choice of nomination as per the option given in paragraph 2 above, on or before
March 31, 2022, failing which the trading accounts shall be frozen for trading and
demat account shall be frozen for debits.”
3. In this regard, on the basis of representations received from various stakeholders,
it has been decided that:
(a) provisions mentioned at Para 7 of the said circular w.r.t. freezing of
accounts shall come into force with effect from March 31, 2023 instead of
March 31, 2022.
(b) requirement mentioned at para 2 read with para 7 w.r.t. re-submission of
nomination details shall be optional for the existing investors who have
already provided the nomination details prior to issuance of the aforesaid
circular.
Page 1 of 4(c) existing investors who have not submitted nomination details till date and
intend to submit their nomination or opt out of nomination (not to nominate
any one) may also be allowed to do so by way of two factor authentication
(2FA) login on the internet trading platform for Stock Brokers/Depository
Participants providing such services.
4. The details previously required in the form at Annexure A of the circular viz. mobile
number, e-mail ID and identification details of the nominee(s)/ guardian(s) of the
minor nominee(s) have been made optional. The revised format of the nomination
form is given in Annexure –A to this circular.
5. All other provisions mentioned in the circular
SEBI/HO/MIRSD/RTAMB/CIR/P/2021/601 dated July 23, 2021 shall remain
unchanged.
6. Stock Exchanges and Depositories are advised to:
a) make necessary amendments to the relevant bye-laws, rules and
regulations, operational instructions, as the case may be, for the
implementation of the above circular; and
b) bring the provisions of this circular to the notice of their constituents and also
disseminate the same on the website.
7. This circular is issued in exercise of powers conferred by 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.
8. This circular is available on SEBI website at www.sebi.gov.in under the
categories “Legal Framework -> Circulars”.
Yours faithfully,
Sd/-
Aradhana Verma
Deputy General Manager
Market Intermediaries Regulation and Supervision Department
Tel. No. 022-2644 9633
Email id - aradhanad@sebi.gov.in
Page 2 of 4Nomination Form
[Annexure A to SEBI circular No. SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2022/23
dated February 24, 2022 on Nomination for Eligible Trading and Demat Accounts –
Extension of timelines and relaxations for existing account holders]
TM / DP FORM FOR NOMINATION
Name and Address (To be filled in by individual applying singly or jointly)
Date D D M M Y Y Y Y UCC/ DP ID I N Client ID
I/We wish to make a nomination. [As per details given below]
Nomination Details
I/We wish to make a nomination and do hereby nominate the following person(s) who shall receive all the assets held in my / our account in the event
of my / our death.
Nomination can be made upto three Details of 1st Nominee Details of 2nd Nominee Details of 3rd Nominee
nominees in the account.
1 Name of the nominee(s) (Mr./Ms.)
2 Share of Equally % % %
each
Nominee [If not equally,
please specify
percentage] Any odd lot after division shall be transferred to the first nominee mentioned in the form.
3 Relationship With the Applicant
( If Any)
4 Address of Nominee(s)
City / Place:
State & Country:
PIN Code
5 Mobile / Telephone No. of
nominee(s) #
6 Email ID of nominee(s) #
7 Nominee Identification details #
[Please tick any one of following
and provide details of same]
󠄀 Photograph & Signature 󠄀󠄀 PAN
󠄀 Aadhaar 󠄀󠄀 Saving Bank
account no. 󠄀 󠄀󠄀 Proof of Identity 󠄀󠄀
Demat Account ID
Sr. Nos. 8-14 should be filled only if nominee(s) is a minor:
8 Date of Birth {in case of minor
nominee(s)}
9 Name of Guardian (Mr./Ms.) {in
case of minor nominee(s) }
10 Address of Guardian(s)
Page 3 of 4City / Place:
State & Country:
PIN Code
11 Mobile / Telephone no. of
Guardian #
12 Email ID of Guardian #
13 Relationship of Guardian with
nominee
14 Guardian Identification details #
[Please tick any one of following
and provide details of same]
󠄀 Photograph & Signature
󠄀 PAN 󠄀 󠄀󠄀 Aadhaar Saving Bank
account no. 󠄀󠄀 Proof of Identity󠄀 󠄀
󠄀 󠄀Demat Account ID
Name(s) of holder(s) Signature(s) of holder*
Sole / First Holder (Mr./Ms.)
Second Holder (Mr./Ms.)
Third Holder (Mr./Ms.)
* Signature of witness, along with name and address are required, if the account holder affixes thumb impression, instead of signature
# Optional Fields (Information required at Serial nos. 5, 6, 7, 11, 12 & 14 is not mandatory)
Note:
This nomination shall supersede any prior nomination made by the account holder(s), if any.
The Trading Member / Depository Participant shall provide acknowledgement of the nomination form to the account holder(s)
Name and Signature of Holder(s)*
1.___________________________________2.__________________________________________3___________________________________
* Signature of witness, along with name and address are required, if the account holder affixes thumb impression, instead of
signature
Page 4 of 4