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| The Ministry of Finance has brought commodity derivatives under the Securities Contract Regulation Rules.
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| In a gazette notification , the ministry, however, said no member may conduct business in commodity derivatives, except by setting up a separate company which shall comply with the regulatory requirements, such as net worth, capital adequacy, margins and exposure norms as may be specified by the Forward Market Commission from time to time.
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| In effect, stock brokers have been given the facility to trade in commodity derivatives too.
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Diktat to FIIs on participatory notes
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| In another notification, the ministry has also stated that foreign institutional investors (FIIs) have to fully disclose information concerning the terms of and parties to off-shore derivative instruments such as participatory notes, equity linked notes or any other such instruments, entered into by it or its sub-accounts or affiliates relating to any securities listed or proposed to be listed in any stock exchange in India, as and when and in such form as the Securities and Exchange Board of India (Sebi) may require.
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| The notification has also dealt in details about the code of conduct to be followed by the FIIs in the course of their transactions in India.
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Depository regulations altered
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| Meanwhile, Sebi has also made some amendments to the depository regulations. As per the amendment, all matters relating to the transfer of securities, maintenance of record of holders of securities, handling of physical securities and establishing connectivity with the depositories shall be handled and maintained at a single point either in-house by the issuer or by a share transfer agent registered with the board.
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| Sebi has also directed that every issuer or its agent or any person who is registered as a depository participant will have to redress the grievances of beneficial owners within thirty days of the date of receipt of the complaint and keep the depository informed about the number and nature of grievances redressed by it and the number of grievances pending before it.
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| Further, the participant shall, within seven days of the receipt of certificate of security furnish to the issuer details of it along with the certificate of security.
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| Within 15 days of receipt of the certificate of security from the participant the issuer shall confirm to the depository that securities comprised in the certificate have been listed on the stock exchange or exchanges where the earlier issued securities are listed and shall also after due verification immediately mutilate and cancel the certificate of security and substitute in its record the name of the depository as the registered owner and shall send a certificate to this effect to the depository and to every stock exchange where the security is listed.
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| However, in the case of unlisted companies the condition of listing on all the stock exchanges where earlier issued shares are listed, shall not be applicable.
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| Every issuer has to submit an audit report on a quarterly basis, starting from September 30, 2003, to the concerned stock exchanges audited by a qualified chartered accountant or a practicing company secretary, for the purposes of reconciliation of the total issued capital, listed capital and capital held by depositories in dematerialized form, the details of changes in share capital during the quarter and the in-principle approval obtained by the issuer from all the stock exchanges where it is listed in respect of such further issued capital. |
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