September 19, 2013
Trading members are hereby informed that the Exchange has received a Circular from SEBI vide Ref. No. CIR/MIRSD/ 07 /2013, September 12, 2013 regarding Know Your Client Requirements for Eligible Foreign Investors. The contents of the said circular are reproduced hereunder for information and necessary action of trading members.
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CIR/MIRSD/ 07 /2013 September 12, 2013
1. All Recognized Stock Exchanges
2. Stock Brokers through Recognized Stock Exchanges
3. Depository Participants through Depositories
4. Mutual funds
5. Association of Mutual Funds in India
6. Portfolio Managers
7. KYC Registration Agencies (KRAs)
8. Alternative Investment Funds (AIFs)
9. Collective Investment Schemes (CIS)
Sub: Know Your Client Requirements for Eligible Foreign Investors
1. This has reference to SEBI circular No CIR/MIRSD/ 11 /2012 dated September 5, 2012 whereby certain clarifications were issued on 'Know Your Client' requirements in case of foreign investors viz. Foreign Institutional Investors, Sub Accounts and Qualified Foreign Investors. This circular is issued in partial modification to the provisions of circular dated September 5, 2012.
2. Eligible foreign investors investing under Portfolio Investment Scheme ('PIS') route shall be classified as Category I, II and III as provided in Annexure A. The intermediary shall follow risk based Know Your Client norms. Accordingly, certain clarifications are hereby issued, as given in Annexure B, based on the category of these investors.
3. Eligible foreign investors investing under PIS route shall be subject to KYC review as and when there is any change in material information / disclosure.
4. The provisions of this circular are applicable for both the new and existing clients.
5. This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 and Sub Rule 14(i) of Rule 9 of the Prevention of Money-laundering (Maintenance of Records) Rules, 2005 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
Deputy General Manager
1) Annexure A - Category of eligible foreign investors investing under PIS route
2) Annexure B – Clarifications
Trading Members are requested to take note of the aforesaid SEBI circular and ensure compliance. This Circular, Annexure-A & Annexure-B mentioned therein are available on SEBI website at www.sebi.gov.in.