The Securities and Exchange Board of India (SEBI) issued a circular on December 3, 2024, providing clarifications on SMS and email alerts for investors. This follows the guidelines established in SEBI Circular no. CIR/MIRSD/15/2011 and the Master Circular for Stock Brokers. The new directive allows stock brokers to upload the same mobile number or email address for multiple clients under exceptional circumstances, provided the clients belong to the same family or, in the case of non-individual clients, are authorized persons of entities such as HUFs, partnerships, trusts, or corporates. The family definition includes self, spouse, dependent children, and dependent parents, while authorized persons for non-individual clients may include Karta or Co-parceners in an HUF, partners in a partnership firm, trustees or beneficiaries in a trust, and corporate authorized persons based on board resolutions. This amendment is effective immediately, and stock exchanges are required to notify their members and amend relevant rules accordingly. The provisions are aimed at enhancing investor protection and ensuring efficient market functioning.
Securities and Exchange Board of India
Circular No. SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2024/169 Dated: 03-12-2024
To,
All recognized Stock Exchanges
Madam / Sir,
Sub: SMS and E-mail alerts to investors by stock exchanges
1. SEBI, vide Circular no. CIR/MIRSD/15/2011 dated August 02, 2011 (hereinafter mentioned as ‘Circular’) and Clause 33 of Master Circular for Stock Brokers dated August 09, 2024 (hereinafter mentioned as ‘Master Circular’), issued guidelines regarding SMS and E-mail alerts to investors by stock exchanges.
2. Point iv of Clause 2B of the Circular and Clause 33.2.4 of the Master Circular states the following regarding uploading of mobile number and e-mail by stock brokers:
Stock Brokers shall ensure that separate mobile number/email address is uploaded for each client. However, under exceptional circumstances, the stock broker may, at the specific written request of a client, upload the same mobile number / email address for more than one client provided such clients belong to one family. ‘Family for this purpose would mean self, spouse, dependent children and dependent parents.
3. Based on the representation received from Brokers’ Industry Standards Forum (ISF), it is further clarified that, under exceptional circumstances, the stock broker may, at the specific written request of a client, upload the same mobile number/E-mail address for more than one client provided such client belong to one family (in case of individual clients) or such client is the authorised person of an HUF, Corporate, Partnership or Trust (in case of non-individual clients).
Family / Authorised person for this purpose shall include:
a. In case of individuals, self, spouse, dependent children and dependent parents.
b. In case of HUF, Karta or any of the Co-parceners as per prior approval of Karta.
c. In case of Partnership firm, any of the partners as per prior approval of all / authorised partners.
d. In case of a Trust, any of the trustees or beneficiaries as per resolution passed by the Trust.
e. In case of Corporates, the Authorised person operating the trading account as per the Board Resolution passed by the Corporate.
4. Accordingly, SEBI Circular no. CIR/MIRSD/15/2011 dated August 02, 2011 and Clause 33 of Master Circular for Stock Brokers dated August 09, 2024 stand amended to the extent of para 3 as detailed above. All other provisions specified in SEBI Circular dated August 02, 2011 and SEBI Master Circular for Stock Brokers dated August 09, 2024 shall continue to remain applicable.
5. The provisions of this circular shall come into force with immediate effect.
6. Stock Exchanges shall:
6.1. bring the provisions of this circular to the notice of their members and also disseminate the same on their websites;
6.2. make necessary amendments to the relevant Bye-laws, Rules and Regulations for the implementation of the above direction;
7. This circular is issued in exercise of powers conferred under Section 11(1) of Chapter IV 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 markets and shall come into effect from the date of this circular.
8. This circular is available on SEBI website at www.sebi.gov.in under the category: ‘Legal → Circulars.
Yours faithfully,
Aradhana Verma
General Manager
Tel. No: 022 26449633
[email protected]
