Regulation 7 - Capital adequacy requirement - Securities and Exchange Board of India (Underwriters) Regulations, 1993

Capital adequacy requirement. 7. (1) The capital adequacy requirement referred to in sub-regulation (d) of regulation 6 shall not be less than the net worth of rupees twenty lakhs. 1 [(2) Notwithstanding anything contained in sub-regulation (1), every stockbroker, who acts as an underwriter shall fulfil the capital adequacy requirements specified by the stock exchange of which he is a member.] Explanation: For the purposes of this regulation, net worth means,- (a) in the case of an applicant being a proprietary concern or a firm or an association of persons or any body of individuals, the value of capital contributed to such business by the applicant and the free reserves of any kind belonging to the business of the applicant; and (b) in the case of a body corporate, the value of the paid-up capital and the free reserves as disclosed in the books of account of the applicant at the time of making the application under sub-regulation (1) of regulation 3. ******** 1 Substituted by the SEBI (Underwriters) (Amendment) Regulations, 2002, w.e.f. 10-12-2002.