Description

SEBI extends deadlines for stock brokers to submit half-yearly net worth certificates required for offering margin trading facilities to clients.

Summary

SEBI has relaxed the timeline for stock brokers to submit half-yearly net worth certificates required to offer margin trading facilities to clients. The new deadlines harmonize with the timeline for declaration of financial results under SEBI Listing Regulations, providing operational relief to brokers.

Key Points

  • Stock brokers must submit half-yearly net worth certificates (March 31 and September 30) to offer margin trading facilities
  • Previous deadlines were April 30 and October 31 respectively
  • New extended deadlines provide additional time for compliance
  • Change aims to promote ease of doing business and harmonize with existing regulatory timelines

Regulatory Changes

Para 4.5.3 of Chapter 1 of the Master Circular for Stock Exchanges and Clearing Corporations (SECC) dated December 30, 2024 has been modified to extend submission deadlines for net worth certificates.

Compliance Requirements

  • Stock brokers must submit auditor-certified net worth certificates half-yearly
  • Certificates must confirm net worth as on March 31 and September 30 each year
  • Submission required to stock exchanges where brokers are registered
  • Certificate submission is mandatory to maintain eligibility for offering margin trading facilities

Important Dates

  • New Deadline for March 31 certificates: May 31 (previously April 30)
  • New Deadline for September 30 certificates: November 15 (previously October 31)
  • Effective Date: Immediate
  • Timeline Basis: 60 days from March half-year end, 45 days from September half-year end

Impact Assessment

This relaxation provides operational relief to stock brokers by extending compliance deadlines by 31 days for March certificates and 45 days for September certificates. The harmonization with listing regulation timelines reduces regulatory complexity and compliance burden. Stock exchanges need to update their bye-laws and notify members of these changes.

Impact Justification

Provides operational relief to stock brokers by extending compliance deadlines, harmonizing with existing listing regulation timelines