Sebi today said brokers will require its prior approval in case integration of their broking activities in equity and commodity derivatives segments leads to a change in control.
Under the integration, Sebi grants a unified licence to brokers and clearing members to operate in commodity derivatives as well as equity markets.
The move is aimed at increasing economic efficiency in terms of meeting operational and compliance obligations at the member level, potentially resulting in ease of doing business.
Also, the integration will help in widening market penetration and facilitate effective regulatory oversight by stock exchanges and Sebi.
"Prior approval from Sebi will be required to be obtained by the stock broker only in cases where integration leads to change in control of the stock broker/clearing member," Securities and Exchange Board of India (Sebi) said in a circular.
Further, to facilitate integration between stock brokers, the regulator said that client account may be transferred from one stock broker to the other by taking the client's consent.
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