Dated: 18th
October 2006
Members are hereby informed
that Securities and Exchange Board of India has notified the
SEBI (Stock Brokers and Sub Brokers) (Third Amendment) Regulations
2006 vide their notification No.S.O.1600(E) dated 25th September
2006 inserting Schedule IIIA and amending Schedule IV of the SEBI (Stock
Brokers and Sub Brokers ) Regulations 1992.The said notification is available
on SEBI website-www.sebi.gov.in is reproduced below.
1. These Regulations may be
called the Securities and Exchange Board of India
(Stock Brokers and
Sub-brokers) (Third Amendment) Regulations, 2006.
2. They shall come into force
on the first day of October, 2006.
3. In the Securities and
Exchange Board of India (Stock Brokers and Sub-brokers)
Regulations, 1992 -
(i) in regulation 10, in
sub-regulation (1), for the word and figures
“Schedule III”, the words and
figures “Schedule III or Schedule III-A, as
the case may be” shall be
substituted;
(ii) in Schedule III, after
clause III, the following clause shall be inserted,
namely: “IV. Non-applicability to
stock brokers governed by Schedule III-A
The provisions of this
Schedule shall not apply to stock brokers to whom
Schedule III-A applies, from
the time when it becomes so applicable.”
(iii) after Schedule III, the
following Schedule shall be inserted, namely:
“Schedule III-A
PAYMENT OF FEES BY STOCK
BROKERS
[Regulation 10(1)]
Part A - Applicability
(a) All stock brokers who are
granted registration by the Board on or after the
first day of October, 2006 –
upon grant of such registration;
(b) All stock brokers who were
granted registration by the Board on or after the
first day of April, 2006, but
before the first day of October, 2006 – from the
first day of October, 2006;
(c) All stock brokers who have
not completed five financial years from the date
of grant of registration by
the Board, as on the thirty first day of March,
2006 – upon completion of ten
financial years from the date of grant of
registration by the Board;
(d) All stock brokers who have
completed five financial years from the date of
grant of registration by the
Board, as on the thirty first day of March, 2006 –
upon completion of the current
block of five financial years, within the
meaning of item I(1)(c) of
Schedule III;
(e) All stock brokers falling
under sub-clauses (c) or (d), who opt in accordance
with clause 2 to be governed
by the provisions of this Schedule – from such
date as may be specified by
the Board.
2. Stock brokers falling under
sub-clauses (c) or (d) of clause 1 may opt to pay fees
in accordance with this
Schedule before completion of the relevant time periods
mentioned in those
sub-clauses, by exercising an option in writing to that effect and
communicating it to the Board,
in such manner and within such time as may be
specified by the Board.
Part B – Charge of fees
3. On and from the
applicability of this Schedule, every stock broker shall pay to
the Board in accordance with
Part C, a fee in respect of the securities transactions
including off-market
transactions undertaken by them, at the rates mentioned
below:
]
|
Sl. No. |
Nature of the
securities transaction |
Rate of fee |
|
a. |
All sale and purchase transactions in
securities other than debt securities |
0.0002 per cent. of the
price at which the securities are purchased
or sold (Rs.20/-
per crore) |
|
b. |
All sale and purchase transactions in debt
securities. |
0.00005 per cent. of the
price at which the securities are purchased
or sold (Rs.5/- per crore) |
4. Nothing in clause 3 shall
affect the liability of any stock broker to pay fees under
Schedule III, which accrued
before this Schedule became applicable to him and
such fees shall be paid as per
the relevant provisions of Schedule III as if they had
not ceased to be applicable to
him.
Part C – Manner of
payment and recovery
5. (1) Every recognised stock exchange shall collect from every
stock broker to
whom
this Schedule applies, the fee payable under clause 3 in respect of -
(a)
securities transactions entered into by him in that stock exchange; and
(b)
off-market transactions entered into by him which are reported to that stock
exchange –
in accordance with the
provisions of its bye-laws.
Explanation: The Board may
specify the manner in which fees shall be collected
from stock brokers who report
the same transactions to different stock exchanges in
which they are members, under
clause (b).
(2)
The fee collected by a recognised stock exchange under sub-clause (1) during a
calendar month shall be paid by the stock exchange to the Board by the fifth
working
day of the following calendar month.
(3)
All recognised stock exchanges shall maintain such registers and furnish such
returns
or information to the Board in respect of the fee collected under this
Schedule,
as may be specified by the Board.
(4)
Without prejudice to sub-clause (3), a recognised stock exchange shall also be
liable
to furnish such information or explanations to the Board as may be required
by
it in respect of fee collected or liable to be collected under this Schedule.
6. (1) Nothing contained in clause 5 shall affect the primary
liability of a stock
broker
to pay the fees under clause 3 or shall preclude the Board from recovering
any
such fee remaining unpaid by any stock broker directly from him.
(2)
Where due to the stock broker’s default any fee which was liable to be paid on
his
behalf under clause 5 remains unpaid or is paid belatedly, he shall, without
prejudice
to any other action that may be taken under the Act, rules or regulations,
pay
an interest of 15 per cent. per annum for every month of delay or part thereof
to the Board.
(3)
Every stock broker shall be liable to furnish such information or
explanations to the Board as may be required
by it in respect of fee paid or payable under this
Schedule.”
(iv) in Schedule IV –
(a)
in clause 1, for the letters and figures “Rs.25,000/-“ the letters and
figures
“Rs.50,000/-“ shall be substituted;
(b)
for clause 2, the following clause shall be substituted, namely:
“2.
Every trading member shall pay to the Board, a fee in respect of the
transactions
undertaken by him on the derivatives segment of a
recognised
stock exchange, at the rate of 0.0002 per cent. of his turnover
(Rs.20/- per crore).
Explanation: (A) For the purpose of this
clause, the expression
‘turnover’
shall include the value of the trades executed by the trading
member
on the derivatives segment of the recognised stock exchange
and
of the trades settled on the expiration of derivatives contracts.
(B)
In case of options contracts, ‘turnover’ shall be computed on the
basis
of premium traded for the option contracts and in case where the
option
is exercised or assigned, it shall be additionally computed on the
basis
of notional value of option contracts exercised or assigned.”
(c) for clause 3, the
following clause shall be substituted, namely:
“3.
(1) Every recognised stock exchange shall collect from every trading
member,
clearing member and self-clearing member, the fee payable
under
clause 2 in respect of his turnover in the derivatives segment of
that
stock exchange in accordance with the provisions of its bye-laws.
(2)
The fee collected by a recognised stock exchange under sub-clause
(1)
during a calendar month shall be paid by the stock exchange to the
Board
by the fifth working day of the following calendar month.
(3)
All recognised stock exchanges shall maintain such registers and
furnish
such returns or information to the Board in respect of the fee
collected
under this Schedule, as may be specified by the Board.
(4)
Without prejudice to sub-clause (3), a recognised stock exchange
shall
also be liable to furnish such information or explanations to the
Board
as may be required by it in respect of fee collected or liable to be
collected
under this Schedule.”
(d) in clause 4, for the words
“as specified in clause 2 and 3 above”, the
words “as specified in clauses
1 and 2” shall be substituted;
(e) for clause 5, the
following clause shall be substituted:
“5.
(1) Nothing contained in clause 3 shall affect the primary liability of
a
trading member to pay the fees under clause 2 or shall preclude the
Board
from recovering any such fee remaining unpaid by any trading
member
directly from him.
(2)
Where due to the trading member’s default any fee which was liable
to
be paid on his behalf under clause 3 remains unpaid or is paid
belatedly,
he shall, without prejudice to any other action that may be
taken
under the Act, rules or regulations, pay an interest of 15 per cent.
per
annum for every month of delay or part thereof to the Board.
(3)
Every trading member shall be liable to furnish such information or
explanations
to the Board as may be required by it in respect of fee paid
or
payable under this Schedule.”
F.No.
SEBI/LAD/DOP/ 604 /2006
M.
DAMODARAN
CHAIRMAN
SECURITIES AND EXCHANGE BOARD OF
INDIA
Unquote
SEBI vide its letter no. MIRSD/DR-1/FC/CIR-15/2006
dated 29th September,2006 and subsequent corrigendum letter no.
MIRSD/DR-1/FC/78011/2006 dated 3rd October,2006 about amendment of
the above mentioned notification and directed the exchange to intimate the same to the brokers of the
exchange which is given as under:
Quote
1.
As per sub
clause 2 of schedule III A of Regulations, Stock brokers falling under sub
clause ( c) and (d)of clause 1 of Schedule III A of Regulations, may opt to pay
fees in accordance with this schedule with effect from October 01,2006 or on
April 01,2007 for which written consent to be given to the stock exchange on or
before 31st day of October,2006 or 28th day of
February,2007 respectively, in the format specified in Annexure 1to this
circular.
2.
As per
clause 5(1) (b) of Schedule III A of Regulations , fee is payable in respect of
off market transactions entered into by stock brokers and which are reported to
that stock exchange . The stock brokers having multiple memberships are
required to report off market
transactions on the respective stock exchanges and shall be required to
pay fees only at the one stock exchange as opted by the stock broker . For this
purpose the stock broker shall be required :
a.
to express
in writing the name of the stock exchange where the off market
transactions be included for the payment
of fees.
b. to intimate the respective
stock exchange where he is having multiple
membership about his intention for
inclusion of off market transaction in the chosen stock exchange.
The stock exchange shall obtain a declaration from the stock broker with
respect to a and b
Above.
3.
The stock
exchanges shall remit the fees to SEBI by way of a banker’s cheque or demand
draft drawn in favour of “ Securities and Exchange Board of India” payable at
Mumbai.
While making the payment the stock
exchanges shall furnish the information in format specified in Annexure 2A for
stock brokers in cash segment and Annexure 2B for stock brokers in derivative
segment.
4 The stock
exchanges shall amend their bye laws .Rules, Regulations as may be
required to give effect
to the amended Regulations so as to facilitate collection of fees and deposit
the same with SEBI as specified in
sub clause (1) of clause 5 of Schedule III A of regulations and sub clause (1) of clause 3 of Schedule IV
of said regulations.
Annexure of the aforesaid notice being Annexure 1
Format for exercising option by the member of an
Exchange
Sub: Option exercised under clause 2 of Schedule III A of SEBI( Stock Brokers and Sub Brokers ) (Third Amendment ) Regulations, 2006 (Regulations)
We, (name of the firm ),
Member, (name of the stock exchange ) having SEBI Registration number ……… were
granted registration by the Board on (date of registration ) [copy of
registration certificate enclosed ].
We have not completed five
financial years from the date of grant registration by the Board as on 31st March,2006 and are covered
by the provisions of clause 1 (c) of Schedule III A of SEBI (Stock Brokers and
Sub Brokers ) ( Third Amendment) Regulations ,2006 / We have completed five
financial years from the date of grant of registration by the Board and are
covered by the provisions of clause 1(d) of Schedule III A of SEBI ( Stock
Brokers and Sub Brokers ) (Third Amendment) Regulations, 2006 ( Delete
whichever is not applicable ).
We hereby opt to pay the fee
in respect of securities transactions including off market transactions
undertaking by us as per Schedule III A of SEBI ( Stock Brokers and Sub Brokers
) (Third Amendment) Regulations, 2006 with effect from ……………….
Thanking you.
Compliance Officer
The members are
requested to note the aforesaid directions of SEBI and act accordingly.