Executive Summary:
This SEBI circular extends certain compliance timelines for Trading Members, Clearing Members, and KYC Registration Agencies due to the ongoing COVID-19 pandemic. It provides an extension until July 31, 2021, for maintaining call recordings, client funding reporting, operating trading terminals from alternate locations, and uploading KYC documents. Exchanges and Depositories must notify their members and participants of these changes.
Key Points / Main Content:
* **Extension of Compliance Deadlines:**
* The deadline for maintaining call recordings of orders/instructions from clients is extended to July 31, 2021.
* The deadline for Client Funding Reporting is extended to July 31, 2021.
* The deadline to operate trading terminals from designated alternate locations is extended to July 31, 2021.
* **KYC Document Uploads:**
* KYC application forms and supporting documents can be uploaded to the KRA system within 15 working days.
* SEBI Registered Intermediaries have a 30-day period, until July 31, 2021, to clear any backlog of KYC uploads.
* **Annual Global Statement:**
* Relaxation for issuing Annual Global Statements physically is provided only if the client has specifically requested a physical statement.
* **Directives to Exchanges and Depositories:**
* Stock Exchanges, Clearing Corporations, and Depositories are directed to inform their members and participants about the circular's provisions and publish it on their websites.
Impact Analysis:
* **Stock Exchanges and Clearing Corporations:**
* Impact: Required to disseminate the circular's contents to their members and participants.
* Action Required: Notify members/participants and publish the circular on their websites.
* **Depositories:**
* Impact: Required to disseminate the circular's contents to their participants.
* Action Required: Notify participants and publish the circular on their websites.
* **Trading Members and Clearing Members:**
* Impact: Extended timelines for compliance related to call recordings, client funding reporting, and operation of trading terminals.
* Action Required: Adjust compliance processes to meet the new deadlines.
* **Depository Participants:**
* Impact: Benefit from extended timelines for compliance.
* Action Required: Adjust compliance processes to meet the new deadlines.
* **KYC Registration Agencies:**
* Impact: Extended timelines for uploading KYC documents.
* Action Required: Ensure all pending KYC documents are uploaded within the extended timeframe.
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.
COVID-19 pandemic: The global health crisis that led to lockdowns and disruptions, prompting SEBI to issue relaxations in regulatory timelines.
Stock Exchanges: Recognized entities that facilitate trading in securities and are regulated by SEBI. Example: Bombay Stock Exchange, National Stock Exchange
Clearing Corporations: Organizations that ensure the orderly settlement of transactions executed on stock exchanges.
Depositories: Institutions that hold securities in electronic form, such as National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL).
Trading Members: Individuals or entities that are members of stock exchanges and authorized to trade on behalf of clients or themselves.
Clearing Members: Members of clearing corporations responsible for clearing and settling trades.
KYC Registration Agencies (KRA): Agencies registered with SEBI that maintain KYC (Know Your Customer) records of investors.
CIRCULAR
SEBI/HO/MIRSD/DOP/P/CIR/2021/587 June 30, 2021
To,
1. All Recognised Stock Exchanges and Clearing Corporations
2. All Depositories
3. Trading members / Clearing Members through Stock Exchanges / Clearing
Corporations
4. Depository Participants through Depositories
5. KYC Registration Agencies
Madam / Sir,
Subject: Relaxation in timelines for compliance with regulatory requirements
1. In view of the situation arising due to COVID-19 pandemic, lockdown imposed by
the Government and representations received from Stock Exchanges, SEBI had
earlier provided relaxations in timelines for compliance with various regulatory
requirements by the trading members / clearing members / depository participants,
vide circular nos. SEBI/HO/MIRSD/DOP/CIR/P/2020/61 dated April 16, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/62 dated April 16, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/68 dated April 21, 2020 and
SEBI/HO/MIRSD/DOP/CIR/P/2020/72 dated April 24, 2020.
2. Later, vide circular nos. SEBI/HO/MIRSD/DOP/CIR/P/2020/82 dated May 15,
2020, SEBI/HO/MIRSD/DOP/CIR/P/2020/101 dated June 19, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/112 dated June 30, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/141 dated July 29, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/142 dated July 29, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/191 dated October 01, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/235 dated December 01, 2020,
SEBI/HO/MIRSD/DOP/CIR/P/2020/255 dated December 31, 2020 and
Page 1 of 3SEBI/HO/MIRSD/DOP/P/CIR/2021/559 dated April 29, 2021, timelines / period of
exclusion were further extended for certain compliance requirements.
3. In view of the prevailing situation due to Covid-19 pandemic and representation
received from Stock Exchanges, it has been decided to extend the timelines for
compliance with the following regulatory requirements by the Trading Members /
Clearing Members / KYC Registration Agencies, as under:
Current timeline / Proposed timeline /
Sr.
Submission/Compliance Period of Period of
No.
exclusion exclusion
Maintaining call recordings of
1 orders/ instructions received
from clients
2 Client Funding Reporting Till June 30, 2021 Till July 31, 2021
To operate the trading
3 terminals from designated
alternate locations
Till June 30, 2021, Till July 31, 2021,
documents may be documents may be
uploaded on to the uploaded on to the
system of KRA system of KRA
KYC application form and within 15 working within 15 working
supporting documents days. days.
4 of the clients to be uploaded *A 30-day time *A 30-day time
on system of KRA period is provided to period is provided to
within 10 working days SEBI Registered SEBI Registered
Intermediary after Intermediary after
June 30, 2021 to July 31, 2021 to
clear the backlog. clear the backlog.
Till June 30, 2021. Till July 31, 2021.
*Relaxation is *Relaxation is
provided only if the provided only if the
Issue of Annual Global
5 client has requested client has requested
Statement to clients
for a physical for a physical
statement. statement.
Page 2 of 34. Stock Exchanges / Clearing Corporations and Depositories are directed to bring
the provisions of this circular to the notice of their members / participants and also
disseminate the same on their websites.
5. 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, 1996 to protect the interests of investors in securities and to
promote the development of, and to regulate the securities markets.
Yours faithfully
Narendra Rawat
General Manager
Market Intermediaries Regulation and Supervision Department
Page 3 of 3