Description

SEBI extends deadlines for stock brokers to submit net worth certificates for margin trading eligibility from 30th April/31st October to 31st May/15th November respectively.

Summary

SEBI has relaxed the timeline for stock brokers to submit net worth certificates required for offering margin trading facilities to clients. The new deadlines are harmonized with financial results declaration timelines under SEBI LODR regulations.

Key Points

  • Timeline extended for submitting half-yearly net worth certificates from auditors
  • New deadlines: 31st May (for March half-year) and 15th November (for September half-year)
  • Previous deadlines were 30th April and 31st October respectively
  • Change aligns with SEBI LODR Regulation 33 timelines for financial results
  • Effective immediately

Regulatory Changes

  • Para 4.5.3 of Chapter 1 of Master Circular for Stock Exchanges and Clearing Corporations (SECC) dated December 30, 2024 modified
  • Certificate submission timeline changed from 30 days to 45 days (September half-year) and 60 days (March half-year) from period end
  • Harmonization with existing financial reporting requirements

Compliance Requirements

  • Stock brokers must continue submitting half-yearly net worth certificates as on 31st March and 30th September
  • Certificates must be from auditors confirming net worth
  • Stock exchanges must amend bye-laws, rules and regulations accordingly
  • Exchanges must notify members and publish on websites

Important Dates

  • Effective Date: Immediate (August 26, 2025)
  • New Deadline for March certificates: 31st May (previously 30th April)
  • New Deadline for September certificates: 15th November (previously 31st October)

Impact Assessment

  • Provides operational relief to stock brokers by extending compliance deadlines
  • Reduces regulatory burden through timeline harmonization
  • Promotes ease of doing business in securities market
  • No impact on margin trading eligibility criteria, only submission timelines

Impact Justification

Provides operational relief to stock brokers but doesn't fundamentally change margin trading requirements