Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018

Jan 04, 2019 | by Avantis RegTech Legal Research Team


The Securities and Exchange Board of India (SEBI) on December 31, 2018 has published the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018 to further amend the Securities and Exchange Board of India (Custodian of Securities) Regulations, 1996.

Some of the major amendments in the Securities and Exchange Board of India (Custodian of Securities) Regulations, 1996 are as under:

·         The title “Securities and Exchange Board of India (Custodian of Securities) Regulations, 1996”, shall be substituted with the title “Securities and Exchange Board of India (Custodian) Regulations, 1996”.

·         The words “custodian of securities” wherever they occur, shall be substituted with the word “custodian”.

·         In Regulation 2 which specifies Definitions:

o   After clause (h), the following new clause shall be inserted, namely:

“(ha) ‘goods’ means the goods notified by the Central Government under clause (bc) of section 2 of the Securities contracts (Regulation) Act, 1956 and forming the underlying of any commodity derivative contract;”

o   After clause (j), the following new clause shall be inserted, namely, - “(k) "securities" shall have the meaning assigned to it in clause (h) ofsection 2 of the Securities Contracts (Regulation) Act, 1956.

·         In Regulation 8 which specifies the Procedure and grant of certificate:

o   in sub-regulation (3), in the proviso:

1.       after the words “respect of securities or” and before the words “in respect of gold”, the words “goods of a client or” shall be inserted; and

2.       the word “client” appearing after the words “gold related instruments of a”, shall be substituted with the word “mutual fund”.

o   after sub-regulation (5), the following new sub-regulation shall be inserted, namely:

“(6) A custodian holding a certificate of registration as on the date of commencement of the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, may provide custodial services in respect of goods only after taking prior approval of the Board.”

·         In regulation 17 which specifies the provisions for Agreement with the client:

1.       In clause (a), after the word “securities” and before the symbol and word “, assets”, the symbol and word “, goods” shall be inserted;

2.       In clause (c), after the words “on the securities” and before the words “of the client”, the words “or goods” shall be inserted.

From the date of publication of the regulations in the Official Gazette, any reference to the Securities and Exchange Board of India (Custodian of Securities) Regulations, 1996 in any regulation, guideline, circular or direction issued by the Board shall be deemed to be referring to the Securities and Exchange Board of India (Custodian) Regulations, 1996 and any reference to the words “custodian of securities” therein shall refer to the term “custodian”.

[Notification No SEBI/LAD-NRO/GN/2019/01]

 

URL: https://www.sebi.gov.in/legal/regulations/jan-2019/securities-and-exchange-board-of-india-custodian-of-securities-amendment-regulations-2018_41531.html


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