National Securities Depository Limited
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November 30, 2018

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Conduct of business with the Clearing Corporation and Clearing Members

13.1 Admission of A Clearing Corporation, A Stock Exchange or A Clearing House of A Stock Exchange
13.1.1.
A Clearing Corporation or a Clearing House of a Stock Exchange may be admitted as a User on the Depository on entering into an agreement as laid down in Annexure R. However, in case of a Clearing House of a Stock Exchange, if such Clearing House is not a legal counter-party to the trades on the Exchange and the trade/settlement guarantee fund is held and managed by the Exchange, then the Clearing House may be admitted as a User on the Depository on entering into an agreement as laid down in Annexure RR and if the Members/Dealers of the Exchange are not the Clearing Members of the Clearing House, the agreement as laid down in Annexure RRA will have to be entered..
13.1.2.
A Stock Exchange may be admitted as a User on the Depository, if it conducts the activity of clearing and settlement of trades and if it is not a legal counter-party to the trades thereon and holds and manages the trade/settlement guarantee fund, on entering into an agreement as laid down in Annexure RRR.
13.1.3.
The provisions of these agreements shall govern the rights and obligations of the Depository, the Clearing Corporation or the Clearing House of a stock exchange and the Exchange, in respect of transactions entered into in pursuance of such agreements. A Clearing Corporation or a Clearing House (either as a separate entity or in-house) of a stock exchange is hereinafter referred to as Clearing Corporation.
   
13.2. Clearing Corporation Account
13.2.1.
The Depository shall allot a unique identification number to the Clearing Corporation admitted as a User on the Depository.
13.2.2.
The Depository shall then open the following accounts for the use of the Clearing Corporation:

  • CC Transit Account
  • CC Settlement Account
13.2.3.
The Clearing Corporation may open one special account known as CC Account with itself. The CC Account shall consist of

  • A Pool account
  • A Delivery account
  • A Receipt-in account
13.2.4.
The CC account will have all the characteristics of CM account. However, the movement of securities from the Pool account of the Clearing Corporation to the Pool accounts of the Clearing Members shall be permitted.
   
13.3. Clearing Member Account
13.3.1.
A Clearing Member may deal in the Depository system as a Clearing Member only through a special account it has opened with a Participant. A Clearing Member account shall consist of

  • A Pool account
  • A Delivery account
  • A Receipt-in account
13.3.2.
A CM account may be opened with the Participant only after the Clearing Member has registered with the Depository and has been allocated an identification number by the Depository (hereinafter referred to as the CM-BP Id).
13.3.3.
A Clearing Member may open only one-CM account. However, a Clearing Member may open one additional CM account with the Clearing Corporation of which it is a Clearing Member for the purpose of Vyaj Badla transactions and the Clearing Corporation shall allot an additional CC-CM-Id to the Clearing Members for this purpose.
13.3.4.
The opening of the CM account shall constitute a standing instruction to receive credits from the Clearing Corporation upon pay-out.
   
13.4. Clearing Member Details
13.4.1.
The Clearing Corporation shall provide to the Depository a list of Clearing Members who are eligible to settle the trades through the Depository giving details such as the unique identification number allotted by it to the Clearing Member for the purpose of settling trades on the Depository (hereinafter referred to as CC-CM-Id) and the name of the Clearing Member.
13.4.2.
The Depository shall provide to the Clearing Corporation a list of Clearing Members who are registered with the Depository giving details like name, CC-CM-Id and CM-BP-Id.
13.4.3.
The Clearing Corporation shall immediately inform the Depository of any addition, deletion or modification to the list of Clearing Members so provided by the Clearing Corporation.
   
13.5. Information regarding Securities available for Dematerialisation and Settlement
13.5.1.
The Depository shall inform the Clearing Corporation after a security is admitted for dematerialisation on the Depository. The Depository shall provide to the Clearing Corporation details of the security viz; ISIN, security description and name of issuing company admitted for dematerialisation on the Depository.
13.5.2.
The Depository shall immediately inform the Clearing Corporation of any addition, deletion or modification to the securities admitted for dematerialisation on the Depository.
13.5.3.
The Clearing Corporation shall inform the Depository about the securities admitted for book-entry settlement before commencement of trading. The Clearing Corporation shall provide to the Depository details of the security viz; ISIN, date of admission for trading, name of issuing company and description of security admitted for book-entry settlement.
13.5.4.
The Clearing Corporation shall inform the Depository regarding the book closure period/record date, ex-dates, the purpose of corporate action, the no-delivery period and the first settlement after no-delivery period as declared by it for each market type in respect of each security available for trading in book-entry segment and settled by the Clearing Corporation, at least five working days prior to the commencement of the no-delivery period.
   
13.6. Settlement Schedule
13.6.1.
The Clearing Corporation shall provide to the Depository on a quarterly basis the settlement schedule relating to the book-entry segment giving the following details in respect of each settlement, at least five working days prior to the commencement of trading in the relevant quarter.

  • Market Type.
  • Settlement Number.
  • Date of commencement of trading.
  • Last date of trading.
  • Date and time of pay-in of securities to the Clearing Corporation.
  • Date and time of pay-out of securities by the Clearing Corporation.
13.6.2.
The Clearing Corporation shall inform the Depository well in advance of any proposed addition, deletion, modification to the settlement schedule and shall add, delete or modify the information only with prior intimation to the Depository.
13.6.3.
The settlement schedule provided by the Clearing Corporation with such additions, deletions and modifications as may have been made from time to time, will constitute an authorisation to the Depository to credit the securities to the CC transit and CC settlement accounts for the relevant settlement by debiting the Delivery accounts of the Clearing Members after the relevant pay-in time.
13.6.4.
The Depository shall inform the Participants and the Clearing Corporation the date and time (hereinafter referred to as NSDL Deadline) before which the Participant can execute the instructions to move securities from the Client's account to the Pool account of the Clearing Member and can execute delivery-out instructions to move securities from the Pool account of the Clearing Member to the Delivery account of the Clearing Member.
   
13.7. Pay-In of Securities
13.7.1.
The Clearing Member may give receipt instructions to its Participant for crediting its Pool account in the form laid down in Annexure M. Alternatively, a Clearing Member may give standing instructions to its Participant to credit its Pool account.
13.7.2.
The Participant shall ensure that the instruction form is complete and the signature of the Clearing Member is valid.
13.7.3.
The Participant shall then execute the instructions of the Clearing Member to credit the Pool account of the Clearing Member.
13.7.4.
The Clearing Member may give delivery-out instructions to its Participant to move securities from its Pool account to its Delivery account in the form laid down in Annexure S.
13.7.5.
The Clearing Corporation may give delivery-out instruction to the Depository on behalf of the Clearing Member(s) after obtaining authority from the Clearing Member(s).
13.7.6.
Nothwithstanding the provisions of Rule 13.7.4, the Clearing Member may instruct the Participant to cancel the delivery-out instruction given by the Clearing Corporation on its behalf and may also submit a delivery-out instruction in the form specified under Rule 13.7.4 to the Participant for its execution.
13.7.7.
The Clearing Member may give a delivery-out instruction to the Participant to move securities from its Pool account to its Delivery account on irreversible basis in the format prescribed at Annexure S. Such instructions once effected shall not be modified or cancelled by the Clearing Member.
13.7.8.
The Participant shall ensure that the instruction form is complete and the signature of the Clearing Member is valid.
13.7.9.
The Participant shall execute the delivery-out instruction to move securities from the Pool account of the Clearing Member to the Delivery account of the Clearing Member.
13.7.10.
The instructions to move securities from the Clients' account to the Pool account of the Clearing Member and the delivery-out instructions to move securities from the Pool account of the Clearing Member to the Delivery account of the Clearing Member shall have effect only before the NSDL Deadline for the relevant settlement.
13.7.11.
The delivery-out instructions given by the Clearing Member shall constitute an authorisation to the Depository to debit the Delivery account of the Clearing Member by crediting the CC transit account for the relevant settlement.
13.7.12.
The Depository shall, after the pay-in time, move the securities from the Delivery accounts of the Clearing Members to the CC transit account for the relevant settlement.
13.7.13.
The Depository shall provide the information to the Clearing Corporation about the credits to the CC transit account giving CC-CM-Id, ISIN and quantity for the relevant settlement.
13.7.14.
The Clearing Corporation shall compare the CC-CM Id and the ISIN with its records and will give instructions to the Depository to move the securities from the CC transit account to the CC settlement account.
13.7.15.
The Depository shall on receipt of such instructions, move the securities from the CC transit account to the CC settlement account for the relevant settlement.
   
13.8. Pay-Out of Securities
13.8.1.
After verification of payment received for the relevant settlement, the Clearing Corporation shall give instructions to the Depository on the pay-out time to debit its CC settlement account and credit the CM accounts giving the CC-CM-Id, ISIN and the quantity for the relevant settlement.
13.8.2.
The Clearing Corporation shall not give instructions for crediting the CC account and CM accounts with securities either less than or in excess of the securities lying in the CC settlement account for the relevant settlement.
13.8.3.
The Depository shall, on receipt of the instructions from the Clearing Corporation, debit the CC settlement account and credit the Receipt-in accounts of the Clearing Members and immediately thereafter move securities from the Receipt-in accounts to the Pool accounts of the Clearing Members.
13.8.4.
The Clearing Member may give instructions to its Participant to debit its Pool account and credit the Clients' accounts in the form laid down in Annexure T.
13.8.5.
The Participant shall ensure that the instruction form is complete and the signature of the Clearing Member is valid.
13.8.6.
The Participant shall execute the instructions of the Clearing Member to debit its Pool account and credit the Clients' accounts.
   
13.9. Inter-Settlement Instructions
13.9.1.
The Clearing Member may for the purpose of moving securities within its Pool Account submit an inter-settlement instruction form to the Participant as laid down in Annexure SS.
13.9.2.
The Participant shall ensure that the instruction form is complete and the signature of the Clearing Member is valid.
13.9.3.
The Participant shall execute the instructions of the Clearing Member to move securities within its Pool account.
   
13.10. CM Pool to CM Pool Instructions
13.10.1.
The Clearing Member may give instructions to its Participant to debit its Pool account and credit the Pool account of another Clearing Member in the form laid down in Annexure ST.
13.10.2.
The Clearing Member may give receipt instructions to its Participant for crediting its Pool account from Pool account of another Clearing Member in the form laid down in Annexure SU. Alternatively, a Clearing Member may give standing instructions to its Participant to credit its Pool account.
13.10.3.
The Participant shall ensure that the instruction form is complete and the signature of the Clearing Member is valid.
13.10.4.
The Participant shall execute the instructions of the Clearing Member to debit / credit the Pool account of the Clearing Member.