Description

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

Summary

BSE has notified amendments to the bye-laws of Indian Clearing Corporation Limited (ICCL) effective immediately. The amendments include revised definitions for clearing banks, modifications to business days provisions, removal of clearing and settlement session requirements, addition of interpretation clauses, and expansion of clearing segments to include commodity derivatives.

Key Points

  • Clearing Bank definition amended to remove reference to banks engaged by Specified Exchange
  • Business Days provision modified to remove the twelve-day annual limit on holidays
  • Clearing and Settlement Session bye-law (1.23) removed entirely
  • New interpretation clause added as Bye-Law 1.23 for undefined terms
  • Clearing Segments expanded to include Commodity Derivatives segment
  • Changes affect Bye-Laws 1.3, 1.20, 1.23, and 2.2 of Chapter I and II

Regulatory Changes

Bye-Law 1.3 - Clearing Banks Definition:

  • Old: Clearing banks included those engaged by Specified Exchange plus banks appointed by Clearing Corporation
  • New: Clearing banks now only refers to banks appointed by Clearing Corporation as funds settling agency

Bye-Law 1.20 - Business Days:

  • Removed: “not exceeding twelve in any calendar year” limitation on advance holidays declared by Relevant Authority
  • Retained: Public holidays under Negotiable Instruments Act, 1881 and Diwali Moorat Day exception

Bye-Law 1.23 - Clearing and Settlement Session:

  • Removed: Entire provision requiring clearing and settlement sessions for clearing members

New Bye-Law 1.23 - Interpretation:

  • Added comprehensive interpretation clause for undefined terms
  • Establishes precedence hierarchy: ICCL Rules/Regulations → BSE Scheme 2005 → SCRA → SEBI Act → Companies Act 2013 → Depositories Act 1996
  • Clarifies gender neutrality and heading interpretation principles

Bye-Law 2.2 - Clearing Segments:

  • Added: Commodity Derivatives segment
  • Existing segments: Equity, Debt, Currency Derivatives, and Equity Derivative

Compliance Requirements

  • Clearing members must familiarize themselves with updated bye-law provisions
  • Operations should align with revised clearing bank definitions
  • Understanding of expanded clearing segments including commodity derivatives
  • Adherence to new interpretation guidelines for undefined terms

Important Dates

  • Circular Date: November 17, 2025
  • Effective Date: Immediate (upon notification)

Impact Assessment

Operational Impact:

  • Streamlines clearing bank appointment process by removing Specified Exchange intermediary role
  • Provides greater flexibility in holiday declarations without annual cap
  • Simplifies clearing processes by removing formal session requirements
  • Enables commodity derivatives clearing operations through ICCL

Market Impact:

  • Expansion to commodity derivatives segment broadens ICCL’s clearing services
  • Enhanced clarity on interpretation of bye-laws reduces ambiguity
  • Improved operational efficiency for clearing members

Affected Entities:

  • Clearing members of ICCL across all segments
  • Clearing banks appointed by ICCL
  • Market participants in equity, debt, currency derivatives, equity derivatives, and commodity derivatives segments

Impact Justification

Operational amendments to clearing corporation bye-laws affecting clearing members and settlement processes, including addition of commodity derivatives segment