Avail 20% discount on updated CA lectures for Dec 21 .Use Code RESULT20 !! Call : 088803-20003

ICICI

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Account Maintenance Charges collected upfront on annual/ half yearly basis on demat accounts


 Notice Date : 01 July 2010

Account Maintenance Charges collected upfront on annual/ half yearly basis on demat accounts

 

CIRCULAR

 

CIR/MRD/DP/ 20 /2010

July 1, 2010

 

To,

All Depositories,

 

Dear Sir(s),

 

Sub: Account Maintenance Charges collected upfront on annual/ half yearly basis on demat accounts

 

1. The Depository Participants (DPs) have a system of collecting account maintenance charge (AMC) from beneficial owners (BOs) towards maintenance of demat accounts for varied periodicity of collection (viz. monthly, quarterly, half yearly and annually). It has been noticed that in cases where AMC is collected on an annual upfront basis, on closure/shifting of

demat account, the AMC for the balance period for which no service has been provided by the DP, is not refunded to the BO..

 

2. In view of the above, it has been decided that in the event of closing of the demat account or shifting of the demat account from one DP to another, the AMC collected upfront on annual/half yearly basis by the DP, shall be refunded by the DP to the BO for the balance of the quarter/s. For instance, in case annual AMC has been paid by the BO and if the BO closes/shifts his account in the first quarter, he shall be refunded the amount of the balance 3 quarters i.e. 3/4th of the AMC. Likewise, if a BO closes/shifts his account in the third quarter, he shall be refunded the amount for the balance one quarter i.e. 1/4th of the AMC.

 

3. For the purpose of the above requirement the year shall begin from the date of opening of the account in quarterly rests.

.

4. The above requirements shall be applicable to all existing and new accounts held with DPs which collect annual/half yearly upfront AMC. It is hereby clarified that the above requirements shall not be applicable to those DPs who collect quarterly/ monthly AMC.

 

5. The Depositories are advised to:-

 

a) make amendments to the relevant bye-laws, rules and regulations for the implementation of the above decision immediately, as may be applicable/necessary ;

 

b) bring the provisions of this circular to the notice of their DPs and also to disseminate the same on their website; and

 

c) Communicate the same to all the BOs.

 

6. This circular is being issued in exercise of the powers conferred by Section 11(1) of Securities and Exchange Board of India Act, 1992 and section 19 of the Depositories Act, 1996 to protect the interest of investors in securities and to promote the development of, and to regulate, the securities market.

 

Yours faithfully,

Harini Balaji

Deputy General Manager

022-26449372

harinib@sebi.gov.in

 

Guest
on 02 July 2010
Notification No : CIR/MRD/DP/ 20 /2010
Published in Shares & Stock
Source : ,










Trending Tags