Employees of public financial institutions as well as those without any identifiable ultimate promoters will not be considered as depository participants under Sebi norms, according to a circular.
The markets regulator on Wednesday issued a circular providing clarity on certain provisions of regulations related to depository participants.
The development comes after stock exchanges, depositories, public financial institutions and public sector banks had sought certain clarifications from the Securities and Exchange Board of India (Sebi).
According to the regulator, a person will not be considered depository participant or its associate, if the same is on the board of a public financial institution or public sector bank, or which has no identifiable ultimate promoter.
A person who is a director in an entity, that itself is a depository participant or has associate as depository participant, then the same will be considered as a depository participant.
Besides, the watchdog said that a "recognised clearing corporation" would not be considered as a depository participant with respect to certain provisions under the regulations for depositories and participants.
The clarification relates to composition of the governing board of depositories.