NSE Circular No: 0407 (10-Sep-09) Consolidated Circular for Capital Market Segment
Download No.: NSCCL/SEC/2009/13060
All Clearing Members and Custodians
In pursuance of Regulations of the Capital Market segment of National Securities Clearing Corporation Ltd. and in replacement of all earlier circulars issued, members of the Capital Market segment are hereby notified the following:
|Item 1||CLEARED AND NON CLEARED DEALS|
|Item 2||CLEARING & SETTLEMNT|
|Item 3||PROCEDURE FOR SETTLEMENT OF NON CLEARED DEALS|
|Item 4||CLEARING DAYS AND SCHEDULED TIME|
|Item 5||MAINTENANCE OF DEPOSITORY ACCOUNT|
|Item 6||PROCEDURE FOR PAY-IN /PAY-OUT OF FUNDS|
|Item 7||PROCEDURE FOR PAY-IN/PAY-OUT OF SECURITIES|
|Item 8||VALUATION PRICE|
|Item 9||CLOSING OUT|
|Item 10||LIQUID ASSETS|
|Item 12||CHARGES AND PENALITES|
|Item 13||SETTLEMENT FUND|
|Item 14||GUIDELINES FOR GOOD / BAD DELIVERY|
|Item 15||FORMAT OF MEMBERS STAMP|
|Item 16||DELIVERY UNITS|
|Item 17||BAD DELIVERY CELL|
|Item 18||COMPANY OBJECTIONS PROCEDURES|
|Item 19||DOCUMENT AND REGISTRATION|
|Item 20||FAKE/ FORGED/STOLEN CERTIFICATES|
|Item 21||CERTIFICATION OF GOOD/BAD DELIVERY|
|Item 22||REQUEST CASES & BAD DELIVERIES|
|Item 23||CLEARING HOUSE PROCEDURES|
|Item 24||CLEARING AND OTHER FORMS|
|Item 25||ELECTRONIC REPORTING|
|Item 26||MUTUAL FUNDS SERVICE SYSTEM|
|Item 27||PRIVITY OF CONTRACT|
For any further clarifications members may contact the Clearing Corporation:
|Department||Contact Numbers||Email ID|
|Collaterals||022-26598263 / firstname.lastname@example.org|
For National Securities Clearing Corporation Limited
Asst. Vice President
CLEARED AND NON CLEARED DEALS
In pursuance of Regulation 3.3 of the NSCCL Capital Market Regulations deals admitted on the CM clearing segment shall be distinguished as under:
1.1 Cleared Deals
Cleared Deals means the following deals executed on the Capital Market Segment of the NSE:
1.2 Non Cleared Deals
Non Cleared Deals are deals other than cleared deals which are executed on the Capital Market Segment of the NSE and include the following:
BASIS FOR CLEARING AND SETTLEMENT OF DEALS AND SETTLEMENT OBLIGATIONS
In pursuance of Regulations 4.3 and 4.4 of the NSCCL Capital Market Regulations the basis for clearing and settlement of deals and settlement obligations is specified as under:
Trading and settlement periods shall be specified by the relevant authority from time to time. Currently all settlements on a T+2 day rolling basis, in accordance with SEBI Circular Ref. No. D&CC/FITTC/CIR-20/2003 dated March 4, 2003.
2.1 Normal Market deals
Deals executed in the normal market in equity shares, warrants, dividends, bonds etc. and including transactions in Trade for Trade, Inter-institutional and Block deal transactions.
2.1.1.Regular normal market deals
Transactions shall be executed in series ''EQ'' and settlement type ''N''. Settlement can be only in dematerialised mode and on a net obligation basis. Settlement Guarantee shall be provided
2.1.2 Trade for Trade -Surveillance segment (TFT-S) Deals
As a measure of risk containment, the relevant authority may shift from time to time certain securities from series ''EQ'' to series ''BE'' - Trade for Trade Surveillance Segment (TFTS) Transactions in this segment shall be settled under settlement type ''W''. Transactions shall be cleared and settled on a trade for trade basis and there shall be no netting of transactions. Settlement Guarantee shall be provided. Settlement shall be in dematerialised mode only.
2.1.3 Inter-Institutional Market (IL) Deals
Inter-Institutional Deals executed on behalf of institutional investors shall be cleared and settled on a net obligations basis within the sub-segment. Settlement of all transactions shall compulsorily be done in dematerialised mode only. All trades shall be settled under settlement type ''N'' and series ''IL''. Settlement Guarantee shall be provided.
18.104.22.168 Eligible clients for IL deals
a) Only FIIs shall be permitted to place sell orders.
b) Buy orders can be placed by FIIs, DFIs, Banks, Mutual Funds, Insurance Companies, Pension Funds and such other institutions as may be approved from time to time.
c) Where RBI has stipulated collective limits for FIIs, NRIs, PIOs etc in certain securities, these entities shall be permitted to place orders on both buy and sell sides.
2.1.4 Block deals
Block Deals shall be executed in a special window and shall be cleared and settled on a net obligations basis within the sub-segment. All trades shall be settled under settlement type ''N'' and series ''BL''. Settlement of all transactions shall compulsorily be done in dematerialised mode only. Settlement Guarantee shall be provided.
2.1.5 Trade for trade (TT) market deals
TT Market deals shall be under series ''BT'' and settlement type ''Z''. Deals shall be settled on a trade for trade basis directly between the parties to the transaction and reported to the Clearing Corporation. Details for reporting are as given in Item 3. Transactions shall be settled on a gross basis and settlement obligations shall arise out of every deal. Transactions may be settled in dematerialised form or in physical form. There shall be no settlement guarantee for TT transactions.
2.2 Auction market deals
Auction Market deals shall be cleared and settled on a trade for trade basis under settlement type ''A''. Auction Market deals shall be settled on a gross obligations basis. Settlement of all transactions shall compulsorily be done in dematerialised mode and settlement guarantee shall be provided.
2.3 Limited Physical Market Deals
Limited Physical (LP) Market Deals shall be settled on a trade for trade basis and settlement obligations shall arise out of every deal. Deals shall be in series ''BT'' and settlement type ''O''. Deliveries shall be only in physical form
2.4 Retail Debt Market (RDM)
RDM deals shall be in series ''GC'' and settlement type ''D''. Deals shall be settled on a net obligation basis and settlement guarantee shall be provided.
PROCEDURE FOR SETTLEMENT OF NON CLEARED DEALS
In pursuance of Regulation 5.1 to 5.7 of the NSCCL Capital Market Regulations the procedure for settlement of non cleared deals is specified as under:
3.1 Procedure for Settlement of TT Market Deals in the Capital Market segment
3.1.1 Settlement Obligations for TT Market deals have to be settled within 2 working days (T + 2 day basis) from the date of deal directly between the buying and selling clearing members.
3.1.2 The exchange of securities and funds has to take place directly between the buying and selling clearing members
3.1.3 The selling clearing member is required to render delivery of securities to the office of the buying clearing member in exchange for funds which may be paid by means of Cheque/Demand Draft/Pay-order by the buying clearing member or by such other means which enable the selling clearing member to realise the funds on the same day as the exchange of securities.
3.1.4 Settlement details must be reported by Custodian and/or TM clearing members to the Clearing Corporation in the formats prescribed as Form No: NSEF 07A or 07B respectively within 24 hours of the settlement.
3.1.5 The delivery of securities in settlement of TT Market deals can be the following units
in marketable lot, or
in certificates of denomination of 1000 shares, or
certificate of the denomination of the traded quantity.
3.1.6 The choice of deciding on the denomination of certificates will rest with the delivering clearing member.
22.214.171.124 TM Clearing members will receive a report of Settlement Obligations for TT Market deals at the end of the day.
126.96.36.199 Custodian Clearing Members will receive a report of Settlement Obligations for the TT Market deals executed on behalf of their clients at the end of the day.
188.8.131.52 Custodian Clearing Members are required to confirm TT Market deals executed on behalf of their clients for settlement purpose within the settlement periods specified by the relevant authority from time to time. In case the custodian clearing member does not confirm the deal, the responsibility to settle the deal will shift to the TM Clearing Member who executed the deal.
3.2 Non-settlement of TT trades
3.2.1 In case a member expresses inability to settle the trade either by paying funds or delivering securities, then the trade will be deemed closed-out at the highest price prevailing in the NSE in Normal Market from the trading day till the date of settlement or 20 % above the official closing price in the Normal Market on the date of settlement of such trade, whichever is higher.
3.2.2 In case of non rectification/replacement of any bad delivery, the trade will be deemed closed-out at the highest price prevailing in the NSE in Normal Market from the trading day till the date of settlement or 20% above the official closing price in Normal Market on the date of settlement of such trade, whichever is higher.
3.2.3 The defaulting member shall pay the difference between the settlement prices and close out price within 5 working days from the date of settlement to the counterparty failing which the amount of difference shall be debited by Clearing Corporation to the account of the defaulting member. On recovery of the said amount, the credit thereof shall be given to the receiving member.
3.2.4 If the defaulting party does not pay the difference, the aggrieved party can refer the matter to the clearing corporation for suitable actions.
3.2.5 The defaulting party shall further pay a penal charge of 0.5 % of the traded value to Clearing Corporation. The penal charges shall be...
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