Anmi asks Sebi to classify brokers as essential services amid virus scare

Association of National Exchanges Members of India (Anmi) on Monday asked markets regulator Securities and Exchange Board of India (Sebi) to include brokers and depository participants as essential services and advise all state governments to issue clarification in this regard.

On the other hand, the mutual fund (MF) industry has sought certain exemptions from Sebi pertaining to compliance requirements for order executions following government’s work-from-home directive, meeting sectoral exposure norms in debt schemes amid liquidity crunch, and consider increasing borrowing limits as redemptions could spike amid Coronavirus scare.

Among other challenges, the industry is anticipating delays in publishing daily net asset values (NAVs) or dispatching physical cheques for redemption and dividend payments.

This comes after 75 districts across all India were put on total lockdown in the wake of coronavirus pandemic.

Three states Maharashtra, Gujarat and Rajasthan have issued clarification to authorities to allow employees working in exchanges, broking offices. However, there is no explicit guidelines or notifications issued by each state government exempting capital market or stock brokers offices from the total lockdown.

There is a total chaos and confusion among stock brokers because of the lockdown as several state governments have not clarified whether stock brokers will be exempted from this, Anmi President Vijay Bhushan said. Many investors urged the government and Sebi to keep markets closed following a harrowing week, where the benchmark indices plunged 12 per cent.

In view of this, Bhushan has written a letter to the Sebi asking the regulator to immediately issue a clarification to include stock brokers and depository participants as essential services and advise all state governments to issue clarification in this regard.

Anmi has requested the regulator to take a balanced view and decide on the future course of action.

The brokers association has said financial markets are integrated globally and, India is playing a major part standing among the top seven ranks globally in equity volumes.

Hence, equity and derivatives markets cannot be shut down while global exchanges or financial markets are active and working around the world. Earlier, Sebi and exchanges have permitted vide their circulars trading through terminals from various locations.

This relaxation is taking care of front office staff of broking offices to work from home to 50 per cent of potential, however, staff serving back offices or servers or operational dependencies cannot be operated working from home, he said.

Thus, it is imperative to declare capital markets or stock broking services as essential services exempted from lockdowns, he added.

Lav Chaturvedi, MD and CEO Reliance Securities said, staff serving back offices, servers and operational dependencies cannot entirely operate from home, and "it is imperative to declare stock broking services as 'Essential services' exempted from the lock-down".

"While Maharashtra, Gujarat and Rajasthan have issued necessary circulars, we support Anmi's request to Sebi to implement this across India, he added.

The Association of National Exchanges Members of India (Anmi) is grouping comprising around 900 stock brokers from across the country.