Executive Summary:
This circular, issued by SEBI on April 24, 2020, provides relaxation in timelines for regulatory compliance by Depositories and Depository Participants (DPs) due to the COVID-19 pandemic. It extends deadlines for various submissions and provides a period of exclusion from March 23, 2020, to May 17, 2020, for redressal of investor grievances and transmission/closure of demat accounts. Depositories must notify their participants about these provisions.
Key Points / Main Content:
* **Submission Deadlines Extended:**
* BO Grievances Report: Extended to May 18, 2020, for reports pertaining to March and April 2020.
* Half Yearly Internal Audit Report (IAR) by DPs: Extended to June 30, 2020, for the half-year ending March 2020.
* Systems audit: Extended to July 31, 2020 for the financial year ended March 31, 2020.
* Reporting for Artificial Intelligence (AI) and Machine Learning (ML) applications: Extended to May 31, 2020, for the quarter ended March 2020.
* Risk Based Supervision: Extended to June 30, 2020, for the half year ended March 2020.
* **Period of Exclusion for Certain Compliance:**
* Redressal of investor grievances through SCORES: A period of exclusion from March 23, 2020, to May 17, 2020, will not be counted for the mandated timelines.
* Transmission of securities: A period of exclusion from March 23, 2020, to May 17, 2020, will not be counted for the mandated timelines.
* Closure of demat account: A period of exclusion from March 23, 2020, to May 17, 2020, will not be counted for the mandated timelines.
* **Grace Period for Backlog Clearance:**
* A 15-day period after May 17, 2020, is allowed for clearing the backlog related to compliance requirements at S. Nos. III, IV and V.
* **Dissemination Responsibility:**
* Depositories are directed to bring the provisions of this circular to the notice of their participants and also disseminate the same on their website.
Impact Analysis:
* Depositories:
* Impact: Need to comply with revised timelines for submissions and ensure compliance by DPs.
* Action Required: Inform DPs about the circular and display it on their website.
* Depository Participants (DPs):
* Impact: Benefit from relaxed timelines for various compliance requirements.
* Action Required: Adhere to the extended deadlines for submissions and utilize the grace period for backlog clearance.
* Investors:
* Impact: Grievance redressal and demat account closure timelines are temporarily affected due to the exclusion period.
* Action Required: Be aware of the adjusted timelines for grievance redressal and demat account closures.
Key Entities Referenced
COVID19: The Coronavirus Disease 2019 pandemic, which caused disruptions and led to regulatory relaxations.
Depositories: Entities that hold securities in electronic form.
Depository Participants DPs: Agents of the depositories through whom investors can avail of depository services.
Securities and Exchange Board of India Act, 1992: The act under which SEBI's powers are conferred.
Depositories Act: Act related to the regulation of depositories in India.
SCORES: SEBI's online platform for handling investor complaints.
Artificial Intelligence AI: Technology used in financial applications, subject to reporting requirements.
Market Intermediaries Regulation and Supervision Department: A department of SEBI
CIRCULAR
SEBI/HO/MIRSD/DOP/CIR/P/2020/72 April 24, 2020
To,
1. All Depositories
2. Depository Participants (DPs) through Depositories
Madam / Sir,
Subject: Relaxation in timelines for compliance with regulatory requirements by
Depository and depository participants.
1. In view of the situation arising due to COVID-19 pandemic, extended lockdown period and
based on representation received from the Depositories regarding relaxation in timelines
for compliance with regulatory requirements by Depositories and depository participants,
it has been decided to provide relaxation in timelines as under:
S. No. Compliance Existing Extended SEBI Circular
Requirements Timelines / Due Timelines / Due Reference
Date Date
I. Submission of 10th of the May 18, 2020 for SEBI/HO/MIRSD/MIRSD
BO Grievances following month the month of 2/CIR/P/2016/95
Report to i.e. 10th April for
March 2020 and dated September 26,
Depositories. the month of
April 2020. 2016.
March 2020.
II. Submission 15th May 2020 for June 30, 2020, SEBI/HO/MIRSD/MIRSD
of half yearly half year ending for half year 2/CIR/P/2016/95
March 2020. ended March
Internal Audit dated September 26,
2020.
Report (IAR) by 2016.
DPs for half year
ended 31st
March 2020.
III. Redressal of Within 15 days of Period of SEBI/HO/MIRSD/MIRSD
investor the date of receipt exclusion shall 6/CIR/P/2017/20 dated
of the complaint
grievances. be from March March 10, 2017
through SCORES
23, 2020 till May & Regulation 36 (f) of
& within 30 days
17, 2020. SEBI (Depositories &
of the date of
Participants)
receipt of the
complaint other Regulations, 2018.
than received
through
SCORES.
Page 1 of 2IV. Transmission of Within 7 days, Period of CIR/MIRSD/10/2013
securities. after receipt of all exclusion shall dated October 28, 2013.
requisite
be from March
documents.
23, 2020 till May
17, 2020.
V. Closure of demat Within a period of Period of CIR/MIRSD/12/2013
account 30 days. exclusion shall dated December 4, 2013.
be from March
23, 2020 till May
17, 2020.
VI. Systems audit on Within three SEBI/HO/MIRSD/CIR/PB
July 31, 2020 for
annual basis. months of the end /2018/147 dated
the financial year
of the financial
December 3, 2018.
ended March 31,
year.
2020.
VII. Reporting for Within 15 May 31, 2020 for SEBI/HO/MIRSD/DOS2/
Artificial calendar days of quarter ended CIR/P/2019/10 January
the expiry of the March 2020.
Intelligence (AI) 04, 2019.
quarter.
and Machine
Learning (ML)
applications.
VIII. Risk Based 15th May for half June 30, 2020 for
Supervision year ended March half year ended -
31, 2020.
March 2020.
2. For compliance requirements at S. Nos. III, IV and V above, a 15-day time period after
May 17, 2020 is allowed to Depository / depository participants, to clear the back log.
3. Depositories are directed to bring the provisions of this circular to the notice of their
participants and also disseminate the same on their website.
4. This circular is issued in exercise of powers conferred under Section 11(1) of the Securities
and Exchange Board of India Act, 1992 and Section 19 of the Depositories Act, to protect
the interests of investors in securities and to promote the development of, and to regulate
the securities markets.
Yours faithfully
D Rajesh Kumar
General Manager
Market Intermediaries Regulation and Supervision Department
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