NOTICE

27^th November, 2003

Re : Disclosure of proprietary trading by broker to client

Members are hereby informed that SEBI has issued letter no. SEBI/MRD/SE/Cir-42/2003 dated November 19, 2003 on the subject cited above. The contents of the letter are reproduced herein below :-

Quote

1. With a view to increase the transparency in the dealings between the broker and the client, it has been decided that every broker shall disclose to his client whether he does client based business or proprietary trading as well.

2.1 The broker shall disclose the aforesaid information to his existing clients within a period of one month from the date of this circular.

2.2 Further, the broker shall disclose this information upfront to his new clients at the time of entering into the Know Your Client agreement.

2.3 In case of a broker who at present does not trade on proprietary account, chooses to do so at a alter date, he shall be required to disclose this to his clients before carrying out any proprietary trading.

4. This circular is being issued in exercise of powers conferred under Section 11(1) 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 market.

Unquote :

Members are requested to take note of the aforesaid modification.

Secretary