The Securities and Exchange Board of India (SEBI) has introduced the third amendment to the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2024, under the SEBI Act, 1992 and the Depositories Act, 1996. The amendment, effective from the date of its publication, includes a new regulation (60A) on “Nomination”. This regulation mandates that every participant provide beneficial owners with the option to nominate a person to whom their securities will transfer upon their death. It also allows for the nomination of an authorized person who may conduct transactions on behalf of the owner if they become incapacitated. In the case of joint ownership, the owners can collectively nominate a person to receive the securities in the event of their collective death. The depository and participant will not be held liable for any actions based on the nomination provided by the beneficial owner.
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 28th November, 2024
SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) (THIRD AMENDMENT) REGULATIONS, 2024
F. No. SEBI/LAD-NRO/GN/2024/213 .—In exercise of the powers conferred by section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) read with section 25 of the Depositories Act, 1996 (22 of 1996), the Board hereby makes the following regulations to further amend the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 namely, —
1. These regulations may be called the Securities and Exchange Board of India (Depositories and Participants) (Third Amendment) Regulations, 2024.
2. They shall come into force on the date of their publication in the Official Gazette.
3. In the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018, —
I) In Chapter VII after regulation 60 a new regulation 60A shall be inserted, namely:
“Nomination
60A. (1) Every participant shall provide an option to the beneficial owner to nominate, in the manner as may be specified, a person to whom the securities held by him shall vest in the event of his death.
(2) Every participant shall provide an option to the beneficial owner to nominate, in the manner as may be specified, a person who shall be authorized to conduct transactions on behalf of the beneficial owner in the event of the incapacitation of the beneficial owner.
(3) Where the account is held in the name of more than one person jointly, the joint beneficial owners may together nominate, in the manner specified, a person upon whom the securities held by them shall vest, in the event of the death of all the joint beneficial owners.
(4) The depository and participant shall not be liable for any action taken on the basis of nomination made by the beneficial owner.”
BABITHA RAYUDU, Executive Director
[ADVT.-III/4/Exty./724/2024-25]
Footnote:
1. The Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 were published in the Gazette of India on October 3, 2018 vide No. No. SEBI/LAD-NRO/GN/20 18/40.2.
2. The Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 were subsequently amended on, –
a. 4th June, 2019 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2019 vide No. SEBI/LAD-NRO/GN/2019/20.
b. 21st February, 2020 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO/GN/2020/04.
c. 17th April, 2020, by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2020, vide No. SEBI/LAD-NRO/GN/2020/10.
d. 5th May, 2021, by the Securities and Exchange Board of India (Payment of Fees and Mode of Payment) (Amendment) Regulations 2021, vide No. SEBI/LAD-NRO/GN/202 1/23.
e. 3rd August, 2021, by the Securities and Exchange Board of India (Regulatory
Sandbox) (Amendment) Regulations, 2021, vide No. SEBI/LAD-NRO/GN/2021/30.
f. 13th August, 2021 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO/GN/202 1/43.
g. 26th October 2021 by the Securities and Exchange Board of India (Depositories and Participants) (Second Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO/GN/202 1/53.
h. 23rd February 2022 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2022 vide No. SEBI/LAD-NRO/GN/2022/74.
i. 2nd March 2023 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2023 vide No. SEBI/LAD-NRO/GN/2023/125.
j. 22nd August, 2023 by the Securities and Exchange Board of India (Depositories and Participants) (Second Amendment) Regulations, 2023 vide No. SEBI/LAD-NRO/GN/2023/147.
k. 10th May, 2024 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/173.
l. 26th August, 2024 by the Securities and Exchange Board of India (Depositories and Participants) (Second Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/200.
