SEBI Brings Stock, Commodity Broking Under Unified Licence

The Securities & Exchange Board of India (SEBI) has allowed brokers of stock and commodity exchanges to do both businesses underneath one entity.

It was a tremendous demand of brokers after commodity derivatives regulations came under SEBI, from the erstwhile ahead Markets commission. The change used to be notified in July, via amending the Securities Contracts (law) principles and SEBI (inventory Brokers and Sub-Brokers) (modification) rules. The regulator issued a round on this regard on Thursday.

Now, business in commodity derivatives, currency derivatives and equity spot derivatives may all be carried out under one entity, contrary to the earlier requirement of doing commodity and equity companies below completely different companies.

A one-time certificates of registration as stockbroker/clearing member might be granted by means of SEBI. Subsequent permissions to act as a stockbroker or clearing member of different exchanges or clearing firms might be granted by respective bourses or clearing corporation, after scrutiny.

SEBI’s prior approval will be required by way of the broker simplest in cases the place an integration would result in exchange in control of the stockbroker/clearing member, says the circular.The move helps all brokers to move extra margins in purchasers' accounts to another segment, as all shall be below one entity now. that is expected to assist inefficient use of money and help in improving business in all segments.

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