SEBI (Stock Brokers and Sub-Brokers) (Second Amendment) Regulations, 2018

Aug 10, 2018 | by Avantis RegTech Legal Research Team


The Securities and Exchange Board of India (SEBI), on July 30, 2018 has passed the SEBI (Stock Brokers and Sub-Brokers) (Second Amendment) Regulations, 2018 to further amend the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992. The Amendment Regulations shall come into force on April 01, 2019.

In the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992, the following amendments have been made:

(I) the definition of “sub-broker” under Regulation 2(1)(gc) shall be omitted;

(II) Chapter III giving the provisions for registration of sub-brokers shall be omitted;

(III) Clauses (l) and (m) under Regulation 17(1) shall be omitted. The omitted clauses stated that every Stock Broker shall keep and maintain the registers of accounts of sub-brokers and an agreement with a sub-broker specifying the scope of authority, and responsibilities of the Stock Broker and such Sub-broker.

(IV) Regulation 18B is omitted which stated that a Stock Broker shall not to deal with unregistered Sub-broker, unless such person has been granted certificate of registration by the SEBI;

(V) Regulation 26(xiv) shall be omitted. The said clause stated that a stock broker or a sub-broker shall be liable for monetary penalty is he acts as an unregistered sub-broker or deals with unregistered sub-brokers.

(VI) in Regulation 27, which gives the Liability for action under the Enquiry Proceeding Regulations:

i.                     the words and symbol “, as the case may be” shall be omitted;

ii.                   the words “or sub-broker” shall be omitted

(VII) in Schedule I, the following Forms shall be omitted:

i.                     Form B: Application Form for Registration as a Sub-broker with Securities and Exchange Board of India;

ii.                   Form C: Recommendation Letter to be given by the Member with whom the Sub-broker is Affiliated;

iii.                  Form CA: Recognition letter to be issued by the Stock Exchange.

(VIII) in Schedule II, all words, symbols and numbers after the words and symbol and number, “(6) False or Misleading Returns: A stock-broker shall not neglect or fail or refuse to submit the required returns and not make any false or misleading statement on any returns required to be submitted to the Board and the stock exchange.”, shall be omitted;

(IX) in Schedule III, clause II that gives the fees to be paid by sub-brokers shall be omitted;

(X) in the regulations, the words “or a sub-broker” wherever they occur shall be omitted;

(XI) in the regulations, including the title of the regulations, the words, symbols and number “and sub-broker” wherever they occur shall be omitted.

[Notification No. SEBI/LAD-NRO/GN/2018/27]

 

URL: https://www.sebi.gov.in/legal/regulations/jul-2018/securities-and-exchange-board-of-india-stock-brokers-and-sub-brokers-second-amendment-regulations-2018_39832.html


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