SEBI vide its circular dated 27th October, 2022 clarified that the block mechanism shall not be applicable to clients having arrangements with custodians registered with SEBI for clearing and settlement of trades after receiving representations from Depositories and Custodians.
This is in reference to SEBI Circular dated 18th August, 2022 where SEBI made the facility of block mechanism mandatory for all Early Pay-In transactions by amending clause 5 of circular dated 16th July, 2021 where the mechanism was introduced on optional basis.
All other provisions in the SEBI circular dated 18th August, 2022 and SEBI circular dated 16th July, 2021 shall continue to remain applicable.
It is to be noted that this circular is applicable to all Depositories and recognized Stock Exchanges and Clearing corporations.