SEBI Implements New Timelines for Nomination and Submission of PAN, Nomination, and KYC Details for Trading and Demat Accounts
Introduction:
SEBI implements recently new timelines for nomination in eligible demat accounts and the submission of PAN, Nomination, and KYC details by physical security holders. This article will discuss the main points of SEBI’s circular and examine its impact on investors.
New Timelines for Trading and Demat Accounts:
In a circular dated July 23, 2021 (SEBI/HO/MIRSD/RTAMB/CIR/P/2021/601), SEBI stipulates that trading and demat accounts without a ‘choice of nomination’ by September 30, 2023, will face freezing. Responding to representations from Exchanges, Depositories, Brokers’ Associations, and other stakeholders, SEBI has made the following decisions:
- SEBI has made the submission of ‘choice of nomination’ for trading accounts voluntary, aiming to facilitate ease of doing business.
- The deadline for submitting the ‘choice of nomination’ for demat accounts has been extended to December 31, 2023.
Impact on Physical Security Holders:
As per SEBI’s circular dated March 16, 2023 (SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/37), folios will be frozen if holders fail to submit PAN, Nomination, Contact details, Bank A/c details, and Specimen signature by September 30, 2023. Considering investor feedback, SEBI has extended the submission deadline for these details to December 31, 2023.
Responsibilities of Stock Exchanges, Depositories, RTAs, and Listed Companies:
SEBI has advised stock exchanges, depositories, RTAs, and listed companies to take the necessary steps to implement the provisions of this circular. This includes amending relevant bye-laws, business rules, regulations, and operational instructions, as required. Additionally, they should communicate the provisions of this circular to their constituents and publish it on their websites. Reporting the implementation status to SEBI and monitoring compliance of this circular are also important.
Conclusion:
SEBI’s new circular aims to safeguard the interests of investors in securities and facilitate the growth and regulation of the securities market. This circular takes immediate effect, superseding previous provisions outlined in various circulars issued by SEBI. Notably, this includes the Master Circulars issued for Stock Brokers and Registrars to an Issue and Share Transfer Agents dated May 17, 2023.
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