Regulation 19 - Consideration of application for grant of certificate of initial registration. - Securities And Exchange Board of India (Depositories And Participants) Regulations, 1996

Consideration of application for grant of certificate of 1 [initial] registration. 19. For the purpose of grant of certificate of 2 [initial] registration, the Board shall take into account all matters which are relevant to or relating to the efficient and orderly functioning of a participant and in particular, whether the applicant complies with the following requirements, namely :- (a) the applicant belongs to one of the following categories,- (i) a public financial institution as defined in section 4A of the Companies Act, 1956 (1 of 1956); (ii) a bank included for the time being in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934); (iii) a foreign bank operating in India with the approval of the Reserve Bank of India; (iv) a State Financial Corporation established under the provisions of section 3 of the State Financial Corporations Act, 1951 (63 of 1951); (v) an institution engaged in providing financial services, promoted by any of the institutions mentioned in sub-clauses (i), (ii), (iii) and (iv), jointly or severally; (vi) a custodian of securities who has been granted a certificate of registration by the Board under sub-section (1A) of section 12 of the Act; (vii) a clearing corporation 3 [or a clearing house] of a stock exchange; (viii) a stock broker who has been granted a certificate of registration by the Board under sub-section (1) of section 12 of the Act : 4 [Provided that the stock broker shall have a minimum net worth of rupees 50 lakhs and the aggregate value of portfolio of securities of the beneficial owners held in dematerialised form in a depository through him, shall not exceed 5 [100 times of the net worth of the stock broker]: Provided further that if the stock broker seeks to act as a participant in more than one depository, he shall comply with the criteria specified in the first proviso separately for each such depository : 6 [Provided further that where the stock broker has a minimum net worth of rupees ten crore, the limits on the aggregate value of the portfolio of securities of the beneficial owners held in dematerialized form in a depository through him shall not be applicable;] (ix) a non-banking finance company, having a net worth of not less than rupees fifty lakhs : Provided that such company shall act as a participant only on behalf of itself and not on behalf of any other person : 7 [Provided further that a non-banking finance company may act as a participant on behalf of any other person, if it has a net worth of ₹ 50 crore in addition to the net worth specified by any other authority;] 8 [(x) a registrar to an issue or share transfer agent who has a minimum net worth of 9 [rupees ten crores] and who has been granted a certificate of registration by the Board under sub-section (1) of section 12 of the Act; 10 [***]] (b) the applicant is eligible to be admitted as a participant of the depository through which it has made the application to the Board; (c) the applicant has adequate infrastructure, systems, safeguards and trained staff to carry on activity as a participant; 11 [(cc) the applicant is a fit and proper person; and] (d) the grant of 12 [initial] certificate of registration is in the interests of investors in the securities market. ************* 1 ibid. 2 ibid. 3 Inserted by the by the SEBI (Depositories and Participants) (Amendment) Regulations, 1997, w.e.f. 7-2-1997. 4 Substituted by the SEBI (Depositories and Participants) (Amendment) Regulations, 1999, w.e.f. 20-5-1999. 5 Substituted by the SEBI (Depositories and Participants) (Third Amendment) Regulations, 1999, w.e.f. 21-9-1999. 6 Inserted by the SEBI (Depositories and Participants) (Amendment) Regulations, 2003, w.e.f. 16-6-2003. 7 Inserted by the by the SEBI (Depositories and Participants) (Amendment) Regulations, 1997, w.e.f. 7-2-1997. 8 Inserted by the SEBI (Depositories and Participants) (Amendment) Regulations, 1999, w.e.f. 20-5-1999. 9 Substituted for 50 lakhs by the SEBI (Depositories and Participants) (Amendment) Regulations, 2003, w.e.f. 16-6-2003. 10 Proviso omitted by SEBI (Depositories and Participants) (Third Amendment) Regulations, 1999, w.e.f. 21-9-1999. 11 Inserted by the SEBI (Depositories and Participants) (Amendment) Regulations, 1998, w.e.f. 5-1-1998. 12 Inserted by the SEBI (Depositories and Participants) (Amendment) Regulations, 2011, w.e.f. 5-7-2011.