SEBI : Change in affiliation of Sub-brokers

Scenarios

(A)

Remarks

(B)

Procedure and Documents to be submitted by the applicant.

(C)

• The sub-broker shall submit the application for change in affiliation to the exchange through the broker with whom affiliation is being sought and exchange shall forward the application to SEBI along-with its recommendation.

(a) Application for change in affiliation to be submitted to the exchange through the broker with whom affiliation is being sought.

Procedure Continued:

(b) The exchange shall ensure and confirm that there is no complaint(s) / action(s) is /are pending against the subbroker seeking change in affiliation and the sub-broker has no outstanding fee against it.

(c) The Exchange shall forward the application complete in all respects to SEBI along with its recommendation.

(d) SEBI shall take the change in affiliation on record and effect the changes on the subbroker certificate.

(e) The modified certificate shall be dispatched to the exchange to be handed over to the broker / subbroker.

Procedure Continued:

(e) The sub-broker seeking change in affiliation shall be eligible to do business with the old broker till the application is granted approval by SEBI. Thereafter, on grant of approval by SEBI the exchange shall ensure that affiliation of the subbroker is changed to new broker with immediate effect.

– Documents to be submitted :

(a) Exchange recom–mendation and recommendation by the broker with whom affiliation is being sought.

(b) Certificate of registration in original for recording change in affiliation. In case of lost /misplaced certificate, an affidavit (on stamp paper of appropriate value) indemnifying SEBI from possible harm caused by loss of certificate and a copy of FIR/ police complaint lodged by the sub-broker is required to be furnished.

Documents continued

(c) Letter from the subbroker seeking change in affiliation addressed to SEBI.

(d) No Objection Certificate (NOC) from the existing affiliated broker with whom the sub-broker wishes to discontinue business.

(e) Certified true copy of the agreement between the broker and the sub-broker.

• The sub-broker affiliated to merging / amalgamating / acquired broker entities may either choose to surrender registration or affiliate with the incoming entity or any other broker.
• The broker must ensure that all the sub-brokers affiliated to it submit the application for change in affiliation or surrender within a period of 15 days.
• The application for surrender of certificate of registration of sub-broker shall be submitted to the exchange through the existing broker whereas the application for change in affiliation of sub-broker shall be submitted to the exchange through the broker with whom affiliation is being sought. The exchange shall forward the application for surrender / change in affiliation to SEBI for approval.

• Sub-brokers affiliated to a broker who has applied for surrender of registration may apply for change in affiliation to another broker or apply for surrender.
• The broker must ensure that all the sub-brokers affiliated to it submit the application for change in affiliation or surrender at the time broker applies for surrender. The application must be submitted through the exchange.
• The application for surrender of certificate of registration of sub-broker shall be submitted to the exchange through the existing broker whereas the application for change in affiliation of sub-broker  shall be submitted to the exchange through broker with whom affiliation is being sought. Exchange shall forward the application for surrender / change in affiliation to SEBI for approval

• Sub-brokers affiliated to a broker who has undergone change in control/change in status or constitution / transfer/ sale/ transmission , may apply for change in affiliation to another broker or apply for surrender
• The broker undergoing change must ensure that all the sub-brokers affiliated to it submit the sub-brokers’ application for change in affiliation or surrender after the issuance of prior approval to the broker and before the registration of the incoming broking entity. The application must be submitted through the exchange.
• Incase the broker expires, the sub-brokers may change their affiliation within a period of six months from the date on which the broker ceases to exist or the registration will be deemed cancelled.
• The application for surrender of certificate of registration of subbroker(s) shall be submitted to the exchange through the existing broker whereas the application for change in affiliation of sub-broker shall be submitted to the exchange through the broker with whom affiliation is being sought. The exchange shall forward the application for surrender / change in affiliation to SEBI for approval

• •Sub-brokers affiliated to a broker against whom punitive action has been taken, may apply for change in affiliation to another broker or apply for surrender The subbrokers must apply for change in affiliation or surrender through the exchange within a period of one (1) month from the date of the SEBI order.
• •The application for surrender of certificate of registration of subbroker(s) shall be submitted to the exchange through the existing broker whereas the application for change in affiliation of sub-broker shall be submitted to the exchange through the broker with whom affiliation is being sought. The exchange shall forward the application for surrender / change in affiliation to SEBI for approval

• In case the broker or the sub-broker terminates the agreement, the sub-broker may apply for change in affiliation or surrender registration.
• In case the sub-broker intends change in affiliation and broker does not issue NOC, the sub-broker may apply for change in affiliation after completion of one month from the date of termination of agreement with the proof of request to the broker for NOC.
• In case the sub-broker terminates the agreement, the sub-broker shall submit an application to the exchange for surrender of certificate of registration as sub-broker and enclose proof of service of notice for termination of agreement with the broker.
• In case the sub-broker is not traceable or does not either apply for change in affiliation or surrender after termination of agreement by the broker, the broker may submit an application for surrender of registration along with proof of service of notice to the sub-broker after a period of one month from the date of termination of agreement.