31st march, 2008 


Sub: Short Selling and Securities lending and borrowing



Members are hereby informed that the Exchange has received a Circular Ref. No MRD/DoP/Cir-05/2007 dated April 27, 2007 from SEBI further to its Circular No. MRD/DoP/SE/Dep/Cir-14/2007, dated 20th December 2007 notified to the members vide Notice dated 21st January 2007. The contents of the said Circular are given here under for information of the members.





Chief General Manager

Market Regulation Department-Division of Policy


MRD/DoP/SE/Cir- 05 /2008

March 19, 2008

 1.        The Executive Directors/Managing Directors/Administrators of all Stock Exchanges

  1. Managing Director & CEO, NSDL
  2. Managing Director & CEO, CDSL

 Dear Sir / Madam,

Sub:- Operationalisation of Short Selling and Securities Lending and Borrowing

  1. SEBI vide circular dated December 20, 2007 had specified the broad framework for short selling by institutional investors and a full-fledged securities lending and borrowing scheme for all market participants.
  2. It has been decided to operationalise the above with effect from Monday, April 21, 2008.
  3. The Stock Exchanges and the Depositories are advised to :

3.1 make necessary amendments to the relevant bye-laws, rules and regulations for the implementation of the above decision.

3.2 bring the provisions of this circular to the notice of the member brokers/clearing members, depository participants and also disseminate the same on their website.

3.3  communicate to SEBI, the status of the implementation of the provisions of this circular in the Monthly Development Report.

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 and Section 19 of the Depositories Act, 1996, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

Yours faithfully,

S V Murali Dhar Rao




The members are requested to note the aforesaid guideline of SEBI and act accordingly.