Segregation and Monitoring of Collateral at Client Level – Extension of timeline

Last updated: 24 November 2021

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The Securities and Exchange Board of India (SEBI) has announced an extension for the implementation of its circular regarding the segregation and monitoring of collateral at the client level. Initially set for December 1, 2021, the effective date for most provisions has been moved to February 28, 2022. This decision was made following representations from stakeholders. Provisions related to paragraphs 4 and 5 of the original circular remain unchanged, effective from October 1, 2021.

Securities and Exchange Board of India

Circular No. SEBI/HO/MRD2/DCAP/P/CIR/2021/667

Dated: November 23, 2021

All Recognized Clearing Corporations
All Recognized Stock Exchanges

Dear Sir/ Madam

Segregation and Monitoring of Collateral at Client Level – Extension of timeline

1. SEBI, vide circular no. SEBI/HO/MRD2_DCAP/CIR/2021/0598 dated July 20, 2021 issued certain provisions in the subject matter. The para 50 of the said circular reads as under:

“ The provisions of Paragraphs 4 and 5 of this circular shall come into force with effect from October 01, 2021, and other provisions of this circular shall come into force with effect from December 01, 2021.”

2. In this regard, on the basis of representations received from stakeholders, it has been decided that provisions of the said circular (apart from provisions of Paragraphs 4 and 5) shall come into force with effect from February 28, 2022 instead of December 01, 2021.

3. This circular is being issued in exercise of 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 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

Yours faithfully

(Sudeep Mishra)
General Manager
Market Regulation Department
Email: sudeepm@sebi.gov.in

FAQ :

The main change is the extension of the timeline for implementing the segregation and monitoring of collateral at the client level. Most provisions will now come into effect on February 28, 2022, instead of December 1, 2021.

The new effective date for the provisions of the circular, excluding paragraphs 4 and 5, is February 28, 2022.

Yes, the provisions of Paragraphs 4 and 5 of the original circular remain effective from October 1, 2021, and are not affected by this extension.

The timeline has been extended based on representations received from stakeholders in the market.

This extension refers to SEBI circular No. SEBI/HO/MRD2/DCAP/P/CIR/2021/667, which modifies the implementation timeline of circular No. SEBI/HO/MRD2_DCAP/CIR/2021/0598 dated July 20, 2021.