SEBI vide its Circular dated 20th April, 2023 issued a Circular for All recognized Stock Exchanges, All recognized Clearing Corporations and All Depositories.
The Circular States:
This circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act 1992, read with Section 10 of the Securities Contracts (Regulation) Act, 1956 and Section 26(3) of the Depositories Act, 1996, to protect the interests of investors in securities and promote the development and regulation of the securities market.
Market Infrastructure Institutions (MIIs) communicate with market participants and investors on a regular basis through circulars, directions, operating instructions, communiques or any other mode of communication. This has led to a plethora of guidelines by the MIIs on various subjects.
Due to the issuance of such guidelines of varied nature and based on the feedback received from the market participants, to ensure that all market participants, including investors, find all applicable provisions on a specific subject at a place, the MIIs shall ensure the following:
Issue Master Circulars to consolidate all guidelines issued and applicable as of March 31 of each year, subject-wise.
Include only relevant guidelines into Master Circular when reviewing existing guidelines on a particular subject.
Such Master Circular shall not include the following
- Bye-laws, Rules and Regulations issued by MIIs
- Status of any compliance by the market participant.
- Actions taken against any entity.
The Master Circular should contain a list of all guidelines and a provision rescinding them with effect from the date of implementation. These guidelines should be archived on the respective websites of The Master Circulars shall contain a savings clause as under:
“Notwithstanding such rescission,
- Anything done or any action taken or purported to have been done or contemplated under the rescinded guidelines before the commencement of this Master Circular shall be deemed to have been done or taken or commenced or contemplated under the corresponding provisions of the Master Circular or rescinded guidelines whichever is applicable.
- The previous operation of the rescinded guidelines or anything duly done or suffered thereunder, any right, privilege, obligation or liability acquired, accrued or incurred under the rescinded guidelines, any penalty, incurred in respect of any violation committed against the rescinded guidelines, or any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty as aforesaid, shall remain unaffected as if the rescinded guideline have never been rescinded.”.
MIIs must issue the first Master Circular on or before June 30, 2023, and then update it on or before April 30 of each year. This ensures that all guidelines issued during the financial year are included.
The MIIs are directed to
- Make necessary amendments to bye-laws, rules and regulations to implement the decision.
- Distribute Master Circulars on their website and bring them to the attention of all stakeholders, including Members, Depository Participants and investors.
This circular shall come into force with immediate effect