The Securities and Exchange Board of India on 5th May 2021 has published the Securities and Exchange Board of India (Intermediaries) (Second Amendment) Regulations, 2021 through which it has notified the Special procedure for action on expulsion from membership of the stock exchange(s) or clearing corporation(s) or termination of all the depository participant agreements with depository.
A new regulation 30A has been notified which specifies the procedure for action on expulsion from membership of the stock exchange.
On receipt of intimation from all the stock exchange(s) or clearing corporation(s) of which the stockbroker or clearing member, as the case may be, was a member, that such stock broker or clearing member, has been expelled from its membership, the Board may issue a notice, calling upon the noticee to make its submission(s), if any, within a period not exceeding 21 days from the date of service thereof, through a written reply, along with documentary evidence, as to why the certificate of registration, granted under the Act or the regulations made thereunder, should not be cancelled.
After considering the facts and circumstances of the case, material on record and the written submissions, if any, the Board shall endeavor to pass an order within twenty days from the date of receipt of written submissions.
Further a copy of the order passed under this regulation shall be sent to the noticee and also uploaded on the website of the Board.
