SEBI Circular No: MRD/ DoP/SE/Cir- 03 /2009 (20-Feb-09) Direct Market Access - Clarification

The Managing Director and CEO The Managing Director

Bombay Stock Exchange National Stock Exchange of India Ltd.,

Phiroze Jeejeebhoy Towers Exchange Plaza

Dalal Street Bandra Kurla Complex Bandra (E)

Mumbai 400001 Mumbai- 400 051

Dear Sir,

Sub: Direct Market Access - Clarification

  1. This is further to the SEBI circular no. MRD/ DoP/SE/Cir- 7 /2008 dated April 03, 2008 regarding introduction of facility for Direct Market Access.

  2. With regard to para 3 of the aforesaid circular, it is clarified as follows:

    1. Institutional investors may use DMA facility through investment managers after due authorization and upon furnishing to the broker/ exchange suitable agreements/ undertakings between the institution and investment manager stating, inter alia, that the institutional investor shall be responsible for all actions undertaken by its authorized investment manager. Such investment managers may execute necessary documents on behalf of the institutional investor.

    2. The Broker-Client Agreement shall provide complete details of such investment manager, including, inter alia, details of their registration/ regulation in their relevant jurisdiction, specify the role and responsibilities of the investment manager, and contain adequate safeguards to ensure that DMA facility is utilized to execute trades of only those institutions for which the investment manager is authorized.

    3. The exchange/ broker shall ensure that proper audit trails are available to establish...

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