Rule 9 - Client Due Diligence. - Prevention of Money-Laundering (Maintenance of Records) Rules, 2005

1 [Client Due Diligence. 9. 72 [ (1) Every reporting entity shall, at the time of commencement of an account-based relationship or while carrying out occasional transaction of an amount equal to or exceeding rupees fifty thousand, whether conducted as a single transaction or several transactions that appear to be connected, or any international money transfer operations, (a) identify its clients, verify their identity using reliable and independent sources of identification, obtain information on the purpose and intended nature of the business relationship, where applicable; (b) take reasonable steps to understand the nature of the customer s business, and its ownership and control; (c) determine whether a client is acting on behalf of a beneficial owner, and identify the beneficial owner and take all steps to verify the identity of the beneficial owner, using reliable and independent sources of identification: Provided that where the Regulator is of the view that money laundering and terrorist financing risks are effectively managed and where this is essential not to interrupt the normal conduct of business, the Regulator may permit the reporting entity to complete the verification as soon as reasonably practicable following the establishment of the relationship: Provided further that where a client is subscribing or dealing with depositary receipts or equity shares, issued or listed in jurisdictions notified by the Central Government, of a company incorporated in India, and it is acting on behalf of a beneficial owner who is a resident of such jurisdiction, the determination, identification and verification of such beneficial owner, shall be as per the norms of such jurisdiction and nothing in sub-rule (3) to sub-rule (9) shall be applicable for due-diligence of such beneficial owner. Explanation .- For the purposes of this proviso, the expression equity shares means a share in the equity share capital of a company and equity share capital shall have the same meaning as assigned to it in the Explanation to section 43 of the Companies Act, 2013 (18 of 2013). ] 2 [(1A) Subject to the provisions of sub-rule (1), every reporting entity shall within 13 [ ten days ] after the commencement of an account-based relationship with a client, file the electronic copy of the client's KYC records with the Central KYC Records Registry; (1B) The Central KYC Records Registry shall process the KYC records received from a reporting entity for de-duplicating and issue a KYC Identifier for each client to the reporting entity, which shall communicate the KYC Identifier in writing to their client; 78 [ (1C) For the purpose of verification of identity of a client, under clause (a) and (b) of sub rule (1) or on-going due diligence as per clause (iii) of sub-rule (12), the reporting entity shall seek the KYC Identifier from the client or retrieve the KYC Identifier, if available, from the Central KYC Records Registry and proceed to obtain KYC records online by using such KYC Identifier and shall not require a client to submit the same KYC records or information or any other additional identification documents or details, unless (a) there is a change in the information of the client as existing in the records of Central KYC Records Registry; or (b) the KYC record or information retrieved is incomplete or is not as per the current applicable KYC norms prescribed by the respective regulator; or (c) the validity period of the downloaded documents has lapsed; or (d) the reporting entity considers it necessary in order to verify the identity or address (including current address) of the client as per the guidelines issued by the regulator under sub-rule (14), or to perform enhanced due diligence or to build an appropriate risk profile of the client. ] (1D) A reporting entity after obtaining additional or updated information from a client under sub-rule (1C), shall 79 [ within seven days or within such period as may be notified by the Central Government ] furnish the updated information to the Central KYC Records Registry which shall update the existing KYC records of the client and the Central KYC Records Registry shall thereafter inform electronically all reporting entities who have dealt with the concerned client regarding updatation of KYC record of the said client. (1E) The reporting entity which performed the last KYC verification or sent updated information in respect of a client shall be responsible for verifying the authenticity of the identity or address of the client. (1F) A reporting entity shall not use the KYC records of a client obtained from the Central KYC Records Registry for purposes other than verifying the identity or address of the client and shall not transfer KYC records or any information contained therein to any third party unless authorised to do so by the client or by the Regulator or by the Director; (1G) The regulator shall issue guidelines to ensure that the Central KYC records are accessible to the reporting entities in real time.] 80 [ (1H) If an update in the KYC record of an existing client is informed by the Central KYC Records Registry to a reporting entity under sub-rule (1D), the reporting entity shall retrieve the updated KYC records from the Central KYC Records Registry and update the KYC record maintained by the reporting entity as per the guidelines issued by the regulator under sub-rule (14) and under clause (g) of sub-rule (2) of rule 9A. ] (2) For the purpose of clause (a) of sub-rule (1), a reporting entity may rely on a third party subject to the conditions that- 73 [ (a) the reporting entity immediately obtains from the third party or from the Central KYC Records Registry, the record or the information of such client due diligence carried out by the third party; ] (b) the reporting entity takes adequate steps to satisfy itself that copies of identification data and other relevant documentation relating to the client due diligence requirements will be made available from the third party upon request without delay; (c) the reporting entity is satisfied that such third party is regulated, supervised or monitored for, and has measures in place for compliance with client due diligence and record-keeping requirements in line with the requirements and obligations under the Act; (d) the third party is not based in a country or jurisdiction assessed as high risk; (e) the reporting entity is ultimately responsible for client due diligence and undertaking enhanced due diligence measures, as applicable; and (f) where a reporting entity relies on a third party that is part of the same financial group, the Regulator may issue guidelines to consider any relaxation in the conditions (a) to (d). (3) The beneficial owner for the purpose of sub-rule (1) shall be determined as under- (a) where the client is a company, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has a controlling ownership interest or who exercises control through other means. Explanation .-For the purpose of this sub-clause- 1. Controlling ownership interest means ownership of or entitlement to more than 61 [ ten ] per cent of shares or capital or profits of the company; 2. Control shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements; (b) where the client is a partnership firm, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has ownership of/entitlement to more than 68 [ ten ] per cent of capital or profits of the partnership 69 [ or who exercises control through other means ] ; 70 [Explanation - For the purpose of this clause, Control shall include the right to control the management or policy decision; ] (c) where the client is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has ownership of or entitlement to more than fifteen per cent of the property or capital or profits of such association or body of individuals; (d) where no natural person is identified under (a) or (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official; (e) where the client is a trust, the identification of beneficial owner(s) shall include identification of the author of the trust, the trustee, the beneficiaries with 62 [ ten ] per cent or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership; and 58 [ (f) where the client or the owner of the controlling interest is an entity listed on a stock exchange in India, or it is an entity resident in jurisdictions notified by the Central Government and listed on stock exchanges in such jurisdictions notified by the Central Government, or it is a subsidiary of such listed entities, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such entities. ] 34 [ (4) Where the client is an individual, he shall for the purpose of sub-rule (1) submit to the reporting entity,- (a) the Aadhaar number where, (i) he is desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other subsidies, Benefits and Services) Act, 2016 (18 of 2016); or (ii) he decides to submit his Aadhaar number voluntarily to a banking company or any reporting entity notified under first proviso to sub-section (1) of section 11A of the Act; or (aa) the proof of possession of Aadhaar number where offline verification can be carried out; or (ab) the proof of possession of Aadhaar number where offline verification cannot be carried out or any officially valid document or the equivalent e-document thereof containing the details of his identity and address; and (b) the Permanent Account Number or the equivalent e-document thereof or Form No. 60 as defined in Income-tax Rules, 1962; and (c) such other documents including in respect of the nature of business and financial status of the client, or the equivalent e-documents thereof as may be required by the reporting entity: ] 17 [*********] (5) Notwithstanding anything contained in sub-rules (4) 35 [ and as an alternative thereto ] 18 [*********] , an individual who desires to open a small account in a banking company may be allowed to open such an account on production of a self-attested photograph and affixation of signature or thumb print, as the case may be, on the form for opening the account: Provided that- (i) the designated officer of the banking company, while opening the small account, certifies under his signature that the person opening the account has affixed his signature or 19 [ thumb ] print, as the case may be, in his presence; 33 [ Provided that where the individual is a prisoner in a jail, the signature or thumb print shall be affixed in presence of the officer in-charge of the jail and the said officer shall certify the same under his signature and the account shall remain operational on annual submission of certificate of proof of address issued by the officer in-charge of the jail. ] (ii) the small account shall be opened only at Core Banking Solution linked banking company branches or in a branch where it is possible to manually monitor and ensure that foreign remittances are not credited to a small account and that the stipulated limits on monthly and annual aggregate of transactions and balance in such accounts are not breached, before a transaction is allowed to take place; (iii) the small account shall remain operational initially for a period of twelve months, and thereafter for a further period of twelve months if the holder of such an account provides evidence before the banking company of having applied for any of the officially valid documents within twelve months of the opening of the said account, with the entire relaxation provisions to be reviewed in respect of the said account after twenty-four months; 60 [ (iiia) Notwithstanding anything contained in clause (iii), the small account shall remain operational between 1 st April, 2020 and 30th June 2020 and such other periods as may be notified by the Central Government. ] (iv) the small account shall be monitored and when there is suspicion of money laundering or financing of terrorism or other high risk scenarios, the identity of client shall be established 36 [ as per the provisions of sub-rule (4) ] ; 21 [*********] 37 [ (v) the foreign remittance shall not be allowed to be credited into the small account unless the identity of the client is fully established as per provision of sub-rule (4): ] Provided that if the client is not eligible to be enrolled for the Aadhaar number, the identity of client shall be established through the production of an officially valid document. 22 [ (6) Where the client is a company, it shall for the purposes of sub-rule (1), submit to the reporting entity the certified copies of the following documents 38 [ or the equivalent e-documents thereof ] , namely:- (i) certificate of incorporation; (ii) Memorandum and Articles of Association; (iii) Permanent Account Number of the company; (iv) a resolution from the Board of Directors and power of attorney granted to its managers, officers or employees, as the case may be, to transact on its behalf; 63 [ ***** ] 40 [ (v) such documents as are required for an individual under sub-rule (4) relating to beneficial owner, managers, officers or employees, as the case may be, holding an attorney to transact on the company's behalf; ]] 64 [ (vi) the names of the relevant persons holding senior management position; and (vii) the registered office and the principal place of its business, if it is different. ] 23 [ (7) Where the client is a partnership firm, it shall, for the purposes of sub-rule (1), submit to the reporting entity the certified copies of the following documents 41 [ or the equivalent e-documents thereof ] , namely:- (i) registration certificate; (ii) partnership deed; (iii) Permanent Account Number of the partnership firm; 65 [ *** ] 42 [ (iv) such documents as are required for an individual under sub-rule (4) relating to beneficial owner, managers, officers or employees, as the case may be, holding an attorney to transact 66 [ on its behalf; and ]] ] 64 [ (v) the names of all the partners and address of the registered office, and the principal place of its business, if it is different. ] 24 [ (8) Where the client is a trust, it shall, for the purposes of sub-rule (1), submit to the reporting entity the certified copies of the following documents 43 [ or the equivalent e-documents thereof ] , namely:- (i) registration certificate; (ii) trust deed; (iii) Permanent Account Number or Form No.60 of the trust; 65 [ *** ] 44 [ (iv) such documents as are required for an individual under sub-rule (4) relating to beneficial owner, managers, officers or employees, as the case may be, holding an attorney to transact on its behalf; ]] 64 [ (v) the names of the beneficiaries, trustees, settlor 74 [ , protector, if any ] and authors of the trust and the address of the registered office of the trust; and (vi) list of trustees and documents as are required for individuals under sub-rule (4) for those discharging role as trustee and authorised to transact on behalf of the trust. ] 25 [ (9) Where the client is an unincorporated association or a body of individuals, it shall submit to the reporting entity the certified copies of the following documents 45 [ or the equivalent e-documents thereof ] , namely:- (i) resolution of the managing body of such association or body of individuals; (ii) Permanent account number or Form No.60 of the unincorporated association or a body of individuals; (iii) power of attorney granted to him to transact on its behalf; 46 [ and ] 47 [ (iv) such documents as are required for an individual under sub-rule (4) relating to beneficial owner, managers, officers or employees, as the case may be, holding an attorney to transact on its behalf; ] (v) such information as may be required by the reporting entity to collectively establish the existence of such association or body of individuals. ]] 64 [ (9A) Every Banking Company or Financial Institution or intermediary, as the case may be, shall register the details of a client, in case of client being a non-profit organisation, on the DARPAN Portal of NITI Aayog, if not already registered, and maintain such registration records for a period of five years after the business relationship between a client and a reporting entity has ended or the account has been closed, whichever is later. (9B) Where the client has submitted any documents for the purpose of sub-rule (1), it shall submit to the reporting entity any update of such documents, for the purpose of updating the records mentioned under sub-rules (4),(5),(6),(7),(8) or (9), as the case may be, within 30 days of such updation. ] (10) Where the client 67 [ purports to act on behalf of juridicial person or individual or trust ] , the reporting entity shall verify that any person purporting to act on behalf of such client is so authorized and verify the identity of that person. 71 [ Provided that in case of a trust, the reporting entity shall ensure that trustees disclose their status at the time of commencement of an account based relationship or when carrying out transactions as specified in clause (b) of sub-rule (1) rule 9. ] (11) No reporting entity shall allow the opening of or keep any anonymous account or account in fictitious names or account on behalf of other persons whose identity has not been disclosed or cannot be verified. (12) (i) Every reporting entity shall exercise ongoing due diligence with respect to the business relationship with every client and closely examine the transactions in order to ensure that they are consistent with their knowledge of the client, his business and risk profile and where necessary, the source of funds. (ii) When there are suspicions of money laundering or financing of the activities relating to terrorism or where there are doubts about the adequacy or veracity of previously obtained client identification data, the reporting entity shall review the due diligence measures including verifying again the identity of the client and obtaining information on the purpose and intended nature of the business relationship, as the case may be. (iii) The reporting entity shall apply client due diligence measures also to existing clients on the basis of materiality and risk, and conduct due diligence on such existing relationships at appropriate times or as may be specified by the regulator, taking into account whether and when client due diligence measures have previously been undertaken and the adequacy of data obtained 75 [ , such that the information or data collected under client due diligence is kept up-to-date and relevant, particularly where there is high risk ] . (13) (i) Every reporting entity shall carry out risk assessment to identify, assess and take effective measures to mitigate its money laundering and terrorist financing risk for clients, countries or geographic areas, and products, services, transactions or delivery channels that is consistent with any national risk assessment conducted by a body or authority duly notified by the Central Government. (ii) The risk assessment mentioned in clause (i) shall- (a) be documented; (b) consider all the relevant risk factors before determining the level of overall risk and the appropriate level and type of mitigation to be applied; (c) be kept up to date; and (d) be available to competent authorities and self-regulating bodies. (14) (i) The regulator shall issue guidelines incorporating the requirements of 10 [sub-rules (1) to (13) 26 [ sub-rule (15) and sub-rule (17) ] ] and may prescribe enhanced or simplified measures to verify the client's identity taking into consideration the type of client, business relationship, nature and value of transactions based on the overall money laundering and terrorist financing risks involved. Explanation .-For the purpose of this clause, simplified measures are not acceptable whenever there is a suspicion of money laundering or terrorist financing, or where specific higher-risk scenarios apply or where the risk identified is not consistent with the national risk assessment. 27 [ (ia) The guidelines issued under clause (i) shall also include appropriate- (A) exemptions, limitations and conditions and alternate and viable means of identification, to provide account based services to clients who are unable to undergo biometric authentication; 48 [****] (B) relaxation for continued operation of accounts for clients who are unable to provide Permanent Account Number or Form No. 60 49 [ and ] ; 50 [ (C) exemption, limitations and conditions and alternate and viable means of identification, to provide account based services of clients who are unable to undergo Aadhaar authentication for receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other subsidies, Benefits and Services) Act, 2016 (18 of 2016); ] owing to injury, illness or infirmity on account of old age or otherwise, and such like causes. ] 76 [ (ib) the guidelines shall include countermeasures to be undertaken when called upon to do so by any international or intergovernmental organisation of which India is a member and accepted by the Central Government. ] 12 [(ii) Every reporting entity shall formulate and implement a Client Due Diligence Programme, incorporating the requirements of sub-rules (1) to (13) 28 [ sub-rule (15) and sub-rule (17) ] and guidelines issued under clause (i) and (ia).] (iii) The Client Due Diligence Programme 77 [ shall have regard to the money laundering and terrorist financing risks and the size of the business and ] shall include policies, controls and procedures, approved by the senior management, to enable the reporting entity to manage and mitigate the risk that have been identified either by the reporting entity or through national risk assessment.] 51 [ (15) Where the client has submitted- (a) his Aadhaar number under clause (a) of sub-rule (4) to the banking company or a reporting entity notified under first proviso to sub-section (1) of section 11A, such banking company or reporting entity shall carry out authentication of the client's Aadhaar number using e-KYC authentication facility provided by the Unique Identification Authority of India; (b) proof of possession of Aadhaar under clause (aa) of sub-rule (4) where offline verification can be carried out, the reporting entity shall carry out offline verification; (c) an equivalent e-document of any officially valid document, the reporting entity shall verify the digital signature as per the provisions of the Information Technology Act, 2000 (21 of 2000) and any rules issues thereunder and take a live photo as specified under Annexure 1. (d) any officially valid document or proof of possession of Aadhaar number under clause (ab) of sub-rule (4) where offline verification cannot be carried out, the reporting entity shall carry out verification through digital KYC as specified under Annexure 1: Provided that for a period not beyond such date as may be notified for a class of reporting entity, instead of carrying out digital KYC, the reporting entity pertaining to such class may obtain a certified copy of the proof of possession of Aadhaar number or the officially valid document and a recent photograph where an equivalent e-document is not submitted. Explanation.- Obtaining a certified copy by the reporting entity shall mean comparing the copy of the proof of possession of Aadhaar number where offline verification cannot be carried out or officially valid document so produced by the client with the original and recording the same on the copy by the authorised officer of the reporting entity as per the provisions contained in the Act.; ] 30 [ (16) Every reporting entity shall, where its client 52 [ submits a proof of possession of Aadhaar Number containing Aadhaar Number, ensure that such client redacts or blacks out ] his Aadhaar number through appropriate means where the authentication of Aadhaar number is not required under sub-rule (15). ] 31 [ (17) (i) A client already having an account based relationship with a reporting entity, shall submit his Permanent Account Number 53 [ or equivalent e-document thereof ] or Form No.60, on such date as may be notified by the Central Government, failing which the account shall temporarily cease to be operational till the time the Permanent Account Number or Form No. 60 is submitted by the client: Provided that before temporarily ceasing operations for an account, the reporting entity shall give the client an accessible notice and a reasonable opportunity to be heard. Explanation. For the purpose of this clause, temporary ceasing of operations 54 [ in relation to an account ] means the temporary suspension of all transactions or activities in relation to that account by the reporting entity till such time the client complies with the provisions of this clause; (ii) if a client having an existing account based relationship with a reporting entity gives in writing to the reporting entity that he does not want to submit his Permanent Account Number 53 [ or equivalent e-document thereof ] or Form No.60, as the case may be, the client s account with the reporting entity shall be closed and all obligations due in relation to the account shall be appropriately settled after establishing the identity of the client in the manner as may be determined by the regulator. ] 32 [ (18) In case of officially valid document furnished by the client does not contain updated address, the following documents 55 [ or their equivalent e-documents thereof ] shall be deemed to be officially valid documents for the limited purpose of proof of address:- (a) utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill); (b) property or Municipal tax receipt; (c) pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address; (d) letter of allotment of accommodation from employer issued by State Government or Central Government Departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies and leave and licence agreements with such employers allotting official accommodation: Provided that the client shall submit updated officially valid document 56 [ or their equivalent e-documents thereof ] with current address within a period of three months of submitting the above documents. ] 59 [ (19) Where a client has provided his Aadhaar number for identification under clause (a) of sub-rule (4) and wants to provide a current address, different from the address as per the identity information available in the Central Identities Data Repository, he may give a self-declaration to that effect to the reporting entity. ] *********** Notes: 1. Substituted Vide Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2013, w.e.f. 27-8-2013. Before Substituted Amended vide Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Amendment Rules, 2007, w.e.f. 24-5-2007, Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Amendment Rules, 2009, w.e.f. 12-11-2009, Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Amendment Rules, 2010, w.e.f. 12-2-2010, Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Second Amendment Rules, 2010, w.e.f. 16-6-2010 and Prevention of Money-laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Third Amendment Rules, 2010, w.e.f. 16-12-2010, before it was read as: 9. Verification of the records of the identity of clients.-( 1) Every banking company, financial institution and intermediary, as the case may be, shall,- (a) at the time of commencement of an account-based relationship, identify its clients, verify their identity and obtain information on the purpose and intended nature of the business relationship, and (b) in all other cases, verify identity while carrying out: (i) transaction of an amount equal to or exceeding rupees fifty thousand, whether conducted as a single transaction or several transactions that appear to be connected, or (ii) any international money transfer operations. (1A) Every banking company, financial institution and intermediary, as the case may be, shall determine whether a client is acting on behalf of a beneficial owner, identify the beneficial owner and take all reasonable steps to verify his identity. Explanation .-For the purposes of this sub-rule beneficial owner shall mean the natural person who ultimately owns or controls a client and/or the person on whose behalf a transaction is being conducted, and includes a person who exercise ultimate effective control over a juridical person. (1B) Every banking company, financial institution and intermediary, as the case may be, shall exercise ongoing due diligence with respect to the business relationship with every client and closely examine the transactions in order to ensure that they are consistent with their knowledge of the client, his business and risk profile and where necessary, the source of funds. (1C) No banking company, financial institution or intermediary, as the case may be, shall allow the opening of or keep any anonymous account or account in fictitious names or account on behalf of other persons whose identity has not been disclosed or cannot be verified. (1D) When there are suspicions of money-laundering or financing of the activities relating to terrorism or where there are doubts about the adequacy or veracity of previously obtained customer identification data, every banking company, financial institution and intermediary shall review the due diligence measures including verifying again the identity of the client and obtaining information on the purpose and intended nature of the business relationship, as the case may be. (2) Where the client is an individual, he shall for the purpose of sub-rule (1), submit to the banking company, financial institution and intermediary, as the case may be, one certified copy of an 'officially valid document' containing details of his identity and address, one recent photograph and such other documents including in respect of the nature of business and financial status of the client as may be required by the banking company or the financial institution or the intermediary, as the case may be : Provided that photograph need not be submitted by a client falling under clause (b) of sub-rule (1). (2A) Notwithstanding anything contained in sub-rule (2), an individual who desires to open a small account in a banking company may be allowed to open such an account on production of a self-attested photograph and affixation of signature or thumb print, as the case may be, on the form for opening the account: Provided that- (i) the designated officer of the banking company, while opening the small account, certifies under his signature that the person opening the account has affixed his signature or thumb print, as the case may be, in his presence; (ii) a small account shall be opened only at Core Banking Solution linked banking company branches or in a branch where it is possible to manually monitor and ensure that foreign remittances are not credited to a small account and that the stipulated limits on monthly and annual aggregate of transactions and balance in such accounts are not breached, before a transaction is allowed to take place; (iii) a small account shall remain operational initially for a period of twelve months, and thereafter for a further period of twelve months if the holder of such an account provides evidence before the banking company of having applied for any of the officially valid documents within twelve months of the opening of the said account, with the entire relaxation provisions to be reviewed in respect of the said account after twenty four months; (iv) a small account shall be monitored and when there is suspicion of money-laundering or financing of terrorism or other high risk scenarios, the identity of client shall be established through the production of officially valid documents, as referred to in sub-rule (2) of rule 9; and (v) foreign remittance shall not be allowed to be credited into a small account unless the identity of the client is fully established through the production of officially valid documents, as referred to in sub-rule (2) of rule 9. (3) Where the client is a company, it shall for the purposes of sub-rule (1) submit to the banking company or financial institution or intermediary, as the case may be, one certified copy of the following documents: (i) Certificate of incorporation; (ii) Memorandum and Articles of Association; (iii) a resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf; and (iv) an officially valid document in respect of managers, officers or employees holding an attorney to transact on its behalf. (4) Where the client is a partnership firm, it shall for the purposes of sub-rule (1) submit to the banking company, or the financial institution, or the intermediary one certified copy of the following documents: (i) registration certificate; (ii) partnership deed; and (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf. (5) Where the client is a trust, it shall, for the purposes of sub-rule (1) submit to the banking company, or the financial institution, or the intermediary one certified copy of the following documents: (i) registration certificate; (ii) trust deed; and (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf. (6) Where the client is an unincorporated association or a body of individuals, it shall submit to the banking company, or the financial institution or the intermediary one certified copy of the following documents: (i) resolution of the managing body of such association or body of individuals; (ii) power of attorney granted to him to transact on its behalf; (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf; and (iv) such information as may be required by the banking company or the financial institution or the intermediary to collectively establish the legal existence of such an association or body of individuals. (6A) Where the client is a juridical person, the banking company, financial institution and intermediary, as the case may be, shall verify that any person purporting to act on behalf of such client is so authorised and verify the identity of that person. (7) (i) The regulator shall issue guidelines incorporating the requirements of sub-rules (1) to (6A) above and may prescribe enhanced measures to verify the client's identity taking into consideration type of client, business relationship or nature and value of transactions. (ii) Every banking company, financial institution and intermediary as the case may be, shall formulate and implement a Client Identification Programme to determine the true identity of its clients, incorporating requirements of sub-rules (1) to (6A) and guidelines issued under clause (i) above. 2. Inserted Vide Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2015, w.e.f. 7-7-2015. 3. Substituted Vide Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2015, w.e.f. 7-7-2015. Before it was read as: (a) the reporting entity immediately obtains necessary information of such client due diligence carried out by the third party; 4. Substituted vide Not. 2/2017 - Dated 1-6-2017 before it was read as, (4) Where the client is an individual, he shall for the purpose of sub-rule (1), submit to the reporting entity, one certified copy of an 'officially valid document' containing details of his identity and address, one recent photograph and such other documents including in respect of the nature of business and financial status of the client as may be required by the reporting entity: Provided that photograph need not be submitted by a client falling under clause (b) of sub-rule (1). (5) Notwithstanding anything contained in sub-rule (4), an individual who desires to open a small account in a banking company may be allowed to open such an account on production of a self-attested photograph and affixation of signature or thumb print, as the case may be, on the form for opening the account: Provided that- (i) the designated officer of the banking company, while opening the small account, certifies under his signature that the person opening the account has affixed his signature or thumb print, as the case may be, in his presence; (ii) a small account shall be opened only at Core Banking Solution linked banking company branches or in a branch where it is possible to manually monitor and ensure that foreign remittances are not credited to a small account and that the stipulated limits on monthly and annual aggregate of transactions and balance in such accounts are not breached, before a transaction is allowed to take place; (iii) a small account shall remain operational initially for a period of twelve months, and thereafter for a further period of twelve months if the holder of such an account provides evidence before the banking company of having applied for any of the officially valid documents within twelve months of the opening of the said account, with the entire relaxation provisions to be reviewed in respect of the said account after twenty four months; (iv) a small account shall be monitored and when there is suspicion of money laundering or financing of terrorism or other high risk scenarios, the identity of client shall be established through the production of officially valid documents, as referred to in sub-rule (4) of rule 9; and (v) foreign remittance shall not be allowed to be credited into a small account unless the identity of the client is fully established through the production of officially valid documents, as referred to in sub-rule (4) of rule 9. (6) Where the client is a company, it shall for the purposes of sub-rule (1) submit to the reporting entity one certified copy of the following documents:- (i) Certificate of incorporation; (ii) Memorandum and Articles of Association; (iii) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf; and (iv) an officially valid document in respect of managers, officers or employees holding an attorney to transact on its behalf. (7) Where the client is a partnership firm, it shall for the purposes of sub-rule (1) submit to the reporting entity one certified copy of the following documents:- (i) registration certificate; (ii) partnership deed; and (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf. (8) Where the client is a trust, it shall, for the purposes of sub-rule (1) submit to the reporting entity one certified copy of the following documents:- (i) registration certificate; (ii) trust deed; and (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf. (9) Where the client is an unincorporated association or a body of individuals, it shall submit to the reporting entity one certified copy of the following documents:- (i) resolution of the managing body of such association or body of individuals; (ii) power of attorney granted to him to transact on its behalf; (iii) an officially valid document in respect of the person holding an attorney to transact on its behalf; and (iv) such information as may be required by the reporting entity to collectively establish the legal existence of such an association or body of individuals. 5. Inserted vide Not. 2/2017 - Dated 1-6-2017 6. Inserted vide notification no. 6/2017 dated 16-10-2017 7. Inserted vide notification no. 6/2017 dated 16-10-2017 8. Substituted vide Notification No. 9/2017 Dated 12-12-2017, before it was read as, submit the Aadhaar number and Permanent Account Number by 31st December, 2017. 9. Substituted vide Notification No. 9/2017 Dated 12-12-2017, before it was read as, Provided that in case client already having an account based relationship with reporting entities prior to date of this notification fails to submit the Aadhaar number and Permanent Account Number by 31st December, 2017, the said account shall cease to be operational till the time the Aadhaar number and Permanent Account Number is submitted by the client. 10. Substituted vide Notification No. 4/2018 - Dated 16-05-2018 , before it was read as, sub-rules (1) to (13) above 11. Inserted vide Notification No. 4/2018 - Dated 16-05-2018 12. Substituted vide Notification No. 4/2018 - Dated 16-05-2018 , before it was read as, (ii) Every reporting entity shall formulate and implement a Client Due Diligence Programme, incorporating the requirements of sub-rules (1) to (13) and guidelines issued under clause (i) above. 13. Substituted vide Notification No. G.S.R. 1078(E). dated 13-10-2018 before it was read as three days 14. Omitted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as who is eligible to be enrolled for an Aadhaar number, 15. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (a) the Aadhaar number issued by the Unique Identification Authority of India; and 16. Omitted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as Provided that where an Aadhaar number has not been assigned to a client, the client shall furnish proof of application of enrolment for Aadhaar and in case the Permanent Account Number is not submitted, one certified copy of an 'officially valid document' shall be submitted. 17. Omitted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (4A) Where the client is an individual, who is not eligible to be enrolled for an Aadhaar number, he shall for the purpose of sub-rule (1), submit to the reporting entity, the Permanent Account Number or Form No.60 as defined in the Income-tax Rules, 1962 : Provided that if the client does not submit the Permanent Account Number, he shall submit one certified copy of an officially valid document' containing details of his identity and address, one recent photograph and such other documents including in respect of the nature or business and financial status of the client as may be required by the reporting entity. 18. Omitted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as and (4A) 19. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as thump 20. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as the Aadhaar number of the client or where an Aadhaar number has not been assigned to the client, through the production of proof of application towards enrolment for Aadhaar along with an officially valid document 21. Omitted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as Provided further that if the client is not eligible to be enrolled for an Aadhaar number, the identity of client shall be established through the production of an officially valid document; 22. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (6) Where the client is a company, it shall for the purposes of sub-rule (1), submit to the reporting entity the certified copies of the following documents:- (i) Certificate of incorporation; (ii) Memorandum and Articles of Association; (iii) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf; (iv) (a) Aadhaar numbers; and (b) Permanent Account Numbers or Form 60 as defined in the Income-tax Rules, 1962 , issued to managers, officers or employees holding an attorney to transact on the company s behalf or where an Aadhaar number has not been assigned, proof of application towards enrolment for Aadhaar and in case Permanent Account Number is not submitted an officially valid document shall be submitted: Provided that for the purpose of this clause if the managers, officers or employees holding an attorney to transact on the company's behalf are not eligible to be enrolled for Aadhaar number and do not submit the Permanent Account Number, certified copy of an officially valid document shall be submitted. 23. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (7) Where the client is a partnership firm, it shall, for the purposes of sub-rule (1), submit to the reporting entity the certified copies of the following documents:- (i) registration certificate; (ii) partnership deed; and (iii) (a) Aadhaar number; and (b) Permanent Account Number or Form 60 as defined in the Income-tax Rules, 1962 , issued to the person holding an attorney to transact on its behalf or where an Aadhaar number has not been assigned, proof of application towards enrolment for Aadhaar and in case Permanent Account Number is not submitted an officially valid document shall be submitted: Provided that for the purpose of this clause, if the person holding an attorney to transact on the company's behalf is not eligible to be enrolled for Aadhaar number and does not submit the Permanent Account Number, certified copy of an officially valid document shall be submitted. 24. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (8) Where the client is a trust, it shall, for the purposes of sub-rule (1) submit to the reporting entity the certified copies of the following documents:- (i) registration certificate; (ii) trust deed; and (iii) (a) Aadhaar number; and (b) Permanent Account Number or Form 60 as defined in the Income-tax Rules, 1962 , issued to the person holding an attorney to transact on its behalf or where Aadhaar number has not been assigned, proof of application towards enrolment for Aadhaar and in case Permanent Account Number is not submitted an officially valid document shall be submitted: Provided that for the purpose of this clause if the person holding an attorney to transact on the company's behalf is not eligible to be enrolled for Aadhaar number and does not submit the Permanent Account Number, certified copy of an officially valid document shall be submitted. 25. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (9) Where the client is an unincorporated association or a body of individuals, it shall submit to the reporting entity the certified copies of the following documents:- (i) resolution of the managing body of such association or body of individuals; (ii) power of attorney granted to him to transact on its behalf; (iii) (a) the Aadhaar number; and (b) Permanent Account Number or Form 60 as defined in the Income-tax Rules, 1962 , issued to the person holding, an attorney to transact on its behalf or where Aadhaar number has not been assigned, proof of application towards enrolment for Aadhaar and in case the Permanent Account Number is not submitted an officially valid document shall be submitted; and (iv) such information as may be required by the reporting entity to collectively establish the legal existence of such an association or body of individuals: Provided that for the purpose of this clause if the person holding an attorney to transact on the company s behalf is not eligible to be enrolled for Aadhaar number and does not submit the Permanent Account Number, certified copy of an officially valid document shall be submitted. 26. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as and sub-rule (15) 27. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as 11 [(ia) The guidelines issued under clause (i) shall also include appropriate exemptions, limitations and conditions and alternate and viable means of identification, to provide account based services to clients who are unable to undergo biometric authentication owing to injury, illness or infirmity on account of old age or otherwise, and such like causes.] 28. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as and sub-rule (15) 29. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as 5 [(15) Any reporting entity, at the time of receipt of the Aadhaar number under provisions of this rule, shall carry out authentication using either e-KYC authentication facility or Yes/No authentication facility provided by Unique Identification Authority of India. 30. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (16) In case the client referred to in sub-rules (4) to (9) of rule 9 is not a resident or is a resident in the States of Jammu and Kashmir, Assam or Maghalaya and does not submit the Permanent Account Number, the client shall submit to the reporting entity one certified copy of officially valid document containing details of his identity and address, one recent photograph and such other document including in respect of the nature of business and financial status of the client as may be required by the reporting entity. 31. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (17) (a) In case the client, eligible to be enrolled for Aadhaar and obtain a Permanent Account Number, referred to in sub-rules (4) to (9) of rule 9 does not submit the Aadhaar number or the Permanent Account Number at the time of commencement of an account based relationship with a reporting entity, the client shall submit the same within a period of six months from the date of the commencement of the account based relationship: Provided that the clients, eligible to be enrolled for Aadhaar and obtain the Permanent Account Number, already having an account based relationship with reporting entities prior to date of this notification, the client shall 8 [submit the Aadhaar number, and Permanent Account Number or Form No. 60, by such date as may be notified by the Central Government] (b) As per regulation 12 of the Aadhaar (Enrolment and Update) Regulations, 2016, the local authorities in the State Governments or Union-territory Administrations have become or are in the process of becoming UIDAI Registrars for Aadhaar enrolment and are organising special Aadhaar enrolment camps at convenient locations for providing enrolment facilities in consultation with UIDAI and any individual desirous of commencing an account based relationship as provided in this rule, who does not possess the Aadhaar number or has not yet enrolled for Aadhaar, may also visit such special Aadhaar enrolment camps for Aadhaar enrolment or any of the Aadhaar enrolment centres in the vicinity with existing registrars of UIDAI. (c) In case the client fails to submit the Aadhaar number and Permanent Account Number within the aforesaid six months period, the said account shall cease to be operational till the time the Aadhaar number and Permanent Account Number is submitted by the client: 9 [Provided that in case the client already having an account based relationship with reporting entities prior to the date of publication of this notification in the official Gazette fails to submit the Aadhaar number and Permanent Account Number by such date as may be notified by the Central Government, the said account shall cease to be operational till the time the Aadhaar Number and Permanent Account Number is submitted by the client.] 32. Substituted vide NOTIFICATION No. G.S.R. 108(E) dated 13-02-2019 before it was read as (18) In case the identity information relating to the Aadhaar number or Permanent Account Number submitted by the client referred to in sub-rules (4) to (9) of rule 9 does not have current address of the client, the client shall submit an officially valid document to the reporting entity.] 7 [Provided that in case of officially valid document furnished by the client does not contain updated address, the following documents shall be deemed to be officially valid documents for the limited purpose of proof of address:- (a) utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill); (b) property or Municipal tax receipt; (c) pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address; (d) letter of allotment of accommodation from employer issued by State Government or Central Government Departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies and leave and licence agreements with such employers allotting official accommodation; Provided further that the client shall submit updated officially valid document with current address within a period of three months of submitting the above documents.] 33. Inserted vide NOTIFICATION No. G.S.R. 381(E) dated 28-05-2019 34. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as 4 [(4) Where the client is an individual, 14 [*********] he shall for the purpose of sub-rule (1) submit to the reporting entity,- 15 [ (a) the Aadhaar number where he is desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other subsidies, Benefits and Services) Act, 2016 (18 of 2016), or a copy of any other officially valid document in other cases containing details of his identity and address, and one recent photograph; and ] (b) the Permanent Account Number or Form No.60 as defined in Income-tax Rules, 1962 , and such other documents including in respect of the nature of business and financial status of the client as may be required by the reporting entity: 16 [*********] Provided further that photograph need not be submitted by a client falling under clause (b) of sub-rule (1). 6 [Explanation.- Obtaining a certified copy by reporting entity shall mean comparing the copy of officially valid document so produced by the client with the original and recording the same on the copy by the authorised officer of the reporting entity in a manner prescribed by the regulator. ] 35. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 3 36. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as through the production of officially valid documents, as referred to in sub-rule (4) and 20 [ Permanent Account Number or Form No.60, as the case may be ] 37. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as (v) the foreign remittance shall not be allowed to be credited into the small account unless the identity of the client is fully established through the production of officially valid documents, as referred to in sub rule (4) and the Aadhaar number of the client or where an Aadhaar number has not been assigned to the client, through the production of proof of application towards enrolment for Aadhaar along with an officially valid document: 38. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 39. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 40. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as (v) one copy of an officially valid document containing details of identity and address, one recent photograph and Permanent Account Numbers or Form No.60 of the managers, officers or employees, as the case may be, holding an attorney to transact on the company s behalf. 41. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 42. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as (iv) one copy of an officially valid document containing details of identity and address, one recent photograph and Permanent Account Number or Form No.60 of the person holding an attorney to transact on its behalf.; 43. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 44. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as (iv) one copy of an officially valid document containing details of identity and address, one recent photograph and Permanent Account Number or Form No.60 of the person holding an attorney to transact on its behalf.; 45. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 46. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 47. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as (iv) one copy of an officially valid document containing details of his identity and address, one recent photograph and Permanent Account Number or Form No.60 of the person holding an attorney to transact on its behalf; and 48. Omitted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as and 49. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 50. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 51. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as 29 [ (15) Any reporting entity, which has been issued banking license by the Reserve Bank of India, at receipt of the Aadhaar number from his client may carry out authentication of the client's Aadhaar number using e-KYC authentication facility provided by the Unique Identification Authority of India upon receipt of the client's declaration that he is desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other Subsidies Benefits and Services) Act, 2016 (18 of 2016) in his account: Provided that in cases where successful authentication of Aadhaar number using e-KYC facility has been carried out, the other officially valid document and photograph need not be submitted by the client. ] 52. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as submits his Aadhaar number, ensure such client to redact or blackout 53. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 54. Substituted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 before it was read as in relation an account 55. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 56. Inserted vide NOTIFICATION No. [F. No. P.12011/24/2017-ES Cell-DoR] dated 19-08-2019 57. Inserted vide NOTIFICATION No. G.S.R. 669(E) dated 18-09-2019 58. Substituted vide NOTIFICATION No. G.S.R. 669(E) dated 18-09-2019 before it was read as (f) where the client or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies. 59. Inserted vide Notification No. G.S.R. 840(E) dated 13-11-2019 60. Inserted vide NOTIFICATION No. G.S.R. 228(E) dated 31-03-2020 61. Substituted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, twenty-five , 62. Substituted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, fifteen , 63. Omitted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, 39 [and] 64. Inserted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , 65. Omitted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, [and] 66. Substituted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, on its behalf: 67. Substituted vide Notification No. S.O. 1074(E)., dated 07-03-2023. , before it was read as, is a juridicial person . 68. Substituted vide Notification No. G.S.R. 652(E) dated 04-09-2023 before it was read as, fifteen 69. Inserted vide Notification No. G.S.R. 652(E) dated 04-09-2023 70. Inserted vide Notification No. G.S.R. 652(E) dated 04-09-2023 71. Inserted vide Notification No. G.S.R. 652(E) dated 04-09-2023 72. Substituted vide Notification No. G.S.R. 745(E) dated 17-10-2023 before it was read as, (1) Every reporting entity shall- (a) at the time of commencement of an account-based relationship- (i) identify its clients, verify their identity, obtain information on the purpose and intended nature of the business relationship; and (ii) determine whether a client is acting on behalf of a beneficial owner, and identify the beneficial owner and take all steps to verify the identity of the beneficial owner: Provided that where the Regulator is of the view that money laundering and terrorist financing risks are effectively managed and where this is essential not to interrupt the normal conduct of business, the Regulator may permit the reporting entity to complete the verification as soon as reasonably practicable following the establishment of the relationship; and (b) in all other cases, verify identity while carrying out- (i) transaction of an amount equal to or exceeding rupees fifty thousand, whether conducted as a single transaction or several transactions that appear to be connected, or (ii) any international money transfer operations. 57 [ Provided that where a client is subscribing or dealing with depository receipts or equity shares, issued or listed in jurisdictions notified by the Central Government, of a company incorporated in India, and it is acting on behalf of a beneficial owner who is a resident of such jurisdiction, the determination, identification and verification of such beneficial owner, shall be as per the norms of such jurisdiction and nothing in the sub-rules (3) to (9) of these rules shall be applicable for due-diligence of such beneficial owner. . Explanation For the purposes of this proviso, the expression equity share means a share in the equity share capital of a company and equity share capital shall have the same meaning as assigned to it in the Explanation to section 43 of the Companies Act, 2013. ] 73. Substituted vide Notification No. G.S.R. 745(E) dated 17-10-2023 before it was read as, 3 [(a) the reporting entity, within two days, obtains from the third party or from the Central KYC Records Registry records or the information of the client due diligence carried out by the third party.] 74. Inserted vide Notification No. G.S.R. 745(E) dated 17-10-2023 75. Inserted vide Notification No. G.S.R. 745(E) dated 17-10-2023 76. Inserted vide Notification No. G.S.R. 745(E) dated 17-10-2023 77. Inserted vide Notification No. G.S.R. 745(E) dated 17-10-2023 78. Substituted vide Notification No. G.S.R. 419(E) dated 19-07-2024 before it was read as, (1C) Where a client, for the purposes of clause (a) and clause (b), submits a KYC Identifier to a reporting entity, then such reporting entity shall retrieve the KYC records online from the Central KYC Records Registry by using the KYC Identifier and shall not require a client to submit the same KYC records or information or any other additional identification documents or details, unless (i) there is a change in the information of the client as existing in the records of Central KYC Records Registry; (ii) the current address of the client is required to be verified; (iii) the reporting entity considers it necessary in order to verify the identity or address of the client, or to perform enhanced due diligence or to build an appropriate risk profile of the client. 79. Substituted vide Notification No. G.S.R. 419(E) dated 19-07-2024 before it was read as, as soon as possible 80. Inserted vide Notification No. G.S.R. 419(E) dated 19-07-2024