SEBI WILL IMPLEMENT A BLOCKING MECHANISM IN CLIENTS’ DEMAT ACCOUNTS FOR SALE TRANSACTIONS
From August 1, 2021, the market regulator Securities and Exchange Board of India (SEBI) will implement a blocking mechanism in Demat accounts of clients doing sale transactions. The time it takes to return securities to a client’s Demat account will be shortened thanks to the block method. According to SEBI, “Clients pay early pay-in (EPI) for sale trades that haven’t yet been completed. If the selling dealer is completed, the securities are adjusted against EPI; however, if the stocks are not sold, they must be returned to the client’s Demat account, which takes time and costs money.”
Depositories have provided clients with the option of using a blocking mechanism in their Demat accounts. Securities in a client’s Demat account can be blocked in favor of a clearing corporation using the depository’s online system or an electronic delivery instruction slip (eDIS) mandate or through a depository participant based on a physical DIS provided by the client or power of attorney (POA) holder.
Furthermore, according to SEBI, if securities for sale are blocked in the depository system in favor of a clearing firm, all margins are presumed to have been collected, and penalties for short or non-collection of margins, including additional margins, are not incurred.
SIXTH AMENDMENT IN PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
The Pension Fund Regulatory and Development Authority amends the Pension Fund Regulatory and Development Authority (Pension Fund) Regulations, 2015 by issuing the following regulations. 2015 Regulations of the Pension Fund Regulatory and Development Authority (Pension Fund): —
The words “forty-nine percent.” shall be replaced with “seventy-four percent.” in line 3 of regulation 8, clause (g) of sub-regulation (1).
The Pension Fund Regulatory and Development Authority (Pension Fund) (Sixth Amendment) Regulations, 2021 may be referred to as the Pension Fund Regulatory and Development Authority (Pension Fund) (Sixth Amendment) Regulations.
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