Sub-Broker Registration Rules Changed

The National Stock Exchange (NSE) has made amendments in the sub-brokers registration form which it had earlier circulated to the members on June 12. The exchange has altered annexure H of the previous form, in which the trading members have to take full responsibility of the sub-brokers.

While the earlier form was an undertaking by the members to take full responsibility of the sub-broker, the new form places greater onus on the trading member and specifically mentions each aspect of the liability which the member will have with respect to the sub-broker.

The fresh form is in the form of the letter which has to be submitted by the trading members to the exchange, in which the members have to take the undertake to comply with and abide by all the requirements of the said scheme, which may be amended from time to time.

The exchange has further put the onus on the broker and asked him to comply with all the requirements of the Sebi regulation 1992 as well as the requirements of the NSE in this regard. The trading members have been asked to ensure the settlement and also to honour all the deals entered into by the member of the exchange

In the event of failure or otherwiseof the sub-broker to settle and honour the deals enetered into by the sub-broker, the trading member has been asked to take discharge the obligations arising out of the said transactions. Though the members had been asked to take full responsibility of the sub-brokers registered with him, the fresh forms have explicitly made the members even liable for all deals the sub-broker may enter into on behalf of the trading member.