Introduction: On October 16, 2023, the Securities and Exchange Board of India (SEBI) released a pivotal document known as the “Master Circular for Stock Exchanges and Clearing Corporations.” This comprehensive circular serves as a vital guide, consolidating various circulars and directions previously issued by SEBI to Stock Exchanges and Clearing Corporations. The primary objective of this circular is to provide users with easy access to all relevant regulatory guidelines.
Detailed Analysis
1. Scope and Applicability: The SEBI Master Circular is effective from its issue date and encompasses all relevant circulars and communications pertaining to Stock Exchanges and Clearing Corporations issued by SEBI up to August 31, 2023. It has been updated to align with the latest statutes and regulations, replacing previously repealed ones.
2. Rescission of Previous Circulars: While the Master Circular rescinds earlier circulars and communications (listed in Schedule I), it is important to note that actions taken under these rescinded circulars remain valid. This means that any actions, registrations, approvals, fees, inspections, investigations, or penalties incurred under the old circulars are considered to have been carried out under the corresponding provisions of the Master Circular. Pending applications with SEBI are also deemed to have been made under this new framework.
3. Legal Framework: The Master Circular references various acts and regulations, such as the Securities Contracts (Regulation) Act, 1956, the Securities and Exchange Board of India Act, 1992, and the Depositories Act, 1996, along with associated regulations. The circular aligns with these legal frameworks, ensuring a consistent regulatory environment.
4. Superseding Previous Circular: This Master Circular supersedes the earlier SEBI Master Circular issued on July 05, 2021. It is available for reference on the official SEBI website (sebi.gov.in).
5. SEBI’s Authority: This Master Circular is issued under the powers conferred by Section 11(1) of the Securities and Exchange Board of India Act, 1992. Its primary goal is to safeguard the interests of investors in securities and promote the development and regulation of the securities market.
Conclusion: The SEBI Master Circular for Stock Exchanges and Clearing Corporations, released in 2023, consolidates and updates the regulatory framework governing these entities. It ensures easy access to all relevant guidelines while clarifying the status of previous circulars and their associated actions. This circular reaffirms SEBI’s commitment to investor protection and market regulation. It is a critical document for all stakeholders in the Indian securities market, providing a comprehensive understanding of the regulatory landscape. For further details and guidance, interested parties are encouraged to refer to the official SEBI website or contact SEBI’s Market Regulation Department.
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Securities and Exchange Board of India
Master Circular No. SEBI/HO/MRD2/PoD-2/CIR/P/2023/171 Dated: October 16, 2023
To,
All Recognized Stock Exchanges
All Recognized Clearing Corporations
Dear Sir / Madam,
Subject: Master Circular for Stock Exchanges and Clearing Corporations
1. Securities and Exchange Board of India (SEBI), from time to time, has been issuing various circulars/directions to Stock Exchanges and Clearing Corporations. In order to enable the users to have access to all the applicable circulars/directions at one place, Master Circular for Stock Exchanges and Clearing Corporations has been prepared.
2. This Master Circular shall come into force from the date of its issue. This Master Circular covers the relevant circulars/communications pertaining to Stock Exchanges and Clearing Corporations issued by SEBI up to August 31, 2023. References in the Master Circular to the Statutes/Regulations which now stand repealed have been suitably updated. This Master Circular rescinds the circulars and communications listed in Schedule I.
3. Notwithstanding such rescission:
a) anything done or any action taken or purported to have been done or taken under the rescinded circulars, including registrations or approvals granted, fees collected, registration or approval suspended or cancelled, any inspection or investigation or enquiry or adjudication commenced or show-cause notice issued, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular;
b) any application made to SEBI under the rescinded circulars, prior to such rescission, and pending before it shall be deemed to have been made under the corresponding provisions of this Master Circular;
c) the previous operation of the rescinded circulars or anything duly done or suffered thereunder, any right, privilege, obligation or liability acquired, accrued or incurred under the rescinded circulars, any penalty, incurred in respect of any violation committed against the rescinded circulars, or any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty as aforesaid, shall remain unaffected as if the rescinded circulars have never been rescinded.
4. Words and expressions used but not defined in this Circular shall have the same meanings as may be defined in Securities Contracts (Regulation) Act, 1956 or the Securities and Exchange Board of India Act, 1992 or the Depositories Act, 1996 or Regulations made thereunder i.e. Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018, SEBI (Depositories and Participants) Regulations, 2018, PIT Regulations, SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003, unless the context requires otherwise.
5. This Master Circular shall supersede previous Master Circular SEBI/HO/MRD2/DDAP/CIR/P/2021/18 dated July 05, 2021 and is available on SEBI website atsebi.gov.in.
6. This Master Circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
Yours faithfully
Vishal Shukla
General Manager
Market Regulation Department
Email: vishals@sebi.gov.in
Phone: 022-2649959
Enclosures:
Chapter 1: Trading
Chapter 2: Trading Software and Technology
Chapter 3: Settlement
Chapter 4: Comprehensive Risk Management for Cash Market and Debt Segment
Chapter 5: Exchange Traded Derivatives
Chapter 6: Administration of Stock Exchanges and Clearing Corporation
Schedule I
