Description

BSE announces amendments to ICCL bye-laws including changes to clearing bank definitions, business days, clearing segments, and introduction of interpretation clauses.

Summary

BSE has announced amendments to the Bye-laws of Indian Clearing Corporation Limited (ICCL) effective from the date specified by the Relevant Authority. The amendments streamline clearing bank definitions, modify business day provisions, remove outdated clearing session requirements, introduce interpretation clauses, and expand clearing segments to include commodity derivatives.

Key Points

  • Definition of “Clearing Banks” amended to remove reference to banks engaged by the Specified Exchange, now only includes banks appointed by the Clearing Corporation
  • Business Days provision modified to remove the cap of “not exceeding twelve” public holidays in a calendar year
  • Clearing and Settlement Session bye-law (1.23) removed entirely
  • New interpretation clause (Bye-Law 1.23) added defining how terms from various acts and regulations should be interpreted
  • Clearing Segments expanded to include Commodity Derivatives in addition to Equity, Debt, Currency Derivatives, and Equity Derivative segments

Regulatory Changes

Bye-Law 1.3 - Clearing Banks Definition

Old: Clearing Banks included both banks engaged by the Specified Exchange and banks appointed by the Clearing Corporation New: Clearing Banks now only includes banks appointed by the Clearing Corporation as funds settling agency

Bye-Law 1.20 - Business Days

Old: Clearing Corporation open on all days except public holidays under Negotiable Instruments Act, 1881 and holidays declared by Relevant Authority “not exceeding twelve in any calendar year” New: Same provision but removal of the twelve-day cap on holidays

Bye-Law 1.23 - Clearing and Settlement Session (Removed)

The provision requiring clearing and settlement sessions to be held as specified by Relevant Authority has been completely removed

New Bye-Law 1.23 - Interpretation

New comprehensive interpretation clause added covering:

  • Words and expressions defined in SCRA, SEBI Act, Companies Act 2013, Depositories Act 1996, and related rules/regulations
  • Precedence rules when terms are defined in multiple sources
  • Gender-neutral language provisions
  • Treatment of headings in bye-laws

Bye-Law 2.2 - Clearing Segments

Old: Separate clearing segments for Equity, Debt, Currency Derivatives, and Equity Derivative Segment New: Added “Commodity Derivatives” to the list of clearing segments

Compliance Requirements

  • Clearing Members must ensure compliance with the amended bye-laws once they become effective
  • Banks acting as clearing banks must be appointed by the Clearing Corporation (not the Specified Exchange)
  • All stakeholders should familiarize themselves with the new interpretation clause for consistent understanding of terms
  • Participants in commodity derivatives segment must comply with applicable clearing requirements

Important Dates

  • Effective Date: To be specified by the Relevant Authority (not yet announced)
  • Circular Date: November 17, 2025

Impact Assessment

Operational Impact: The amendments streamline clearing operations by centralizing clearing bank appointments under ICCL rather than the Specified Exchange. The removal of the clearing and settlement session bye-law suggests a move toward more flexible operational procedures.

Market Structure: Addition of Commodity Derivatives to clearing segments indicates expansion of ICCL’s clearing services, potentially supporting growth in commodity derivatives trading on BSE.

Regulatory Compliance: The new interpretation clause provides clearer guidance on how to interpret terms across multiple regulatory frameworks, reducing ambiguity in compliance matters.

Stakeholders Affected: Clearing Members, Clearing Banks, BSE, and participants in all clearing segments including the newly added Commodity Derivatives segment.

Impact Justification

Administrative amendments to ICCL bye-laws affecting clearing and settlement operations, including removal of exchange-appointed clearing banks and addition of commodity derivatives segment