INDIA: SEBI Announces Amendment Pertaining to IPF, ISF

Tuesday October 26 2021

On 22^nd October 2021, the Securities and Exchange Board of India (SEBI) Issued a circular dated on June 13^th, 2017, on Comprehensive guidelines for Investor Protection Fund (IPF), Investor Service Fund (ISF) and its related matters.

• Based on the internal deliberations/discussions, and the feedback received from the  Stock Exchanges, SEBI  has  been  decided  to modify the  following clause of  the  aforesaid circular:

Clause 2 (g) shall be substituted with the following:

• Determination of legitimate claims

The Stock Exchanges shall ensure that once  a  member  has  been  declared defaulter,  the  claim shall  be  placed  before  the  Member  Core  Settlement Guarantee Fund Committee for sanction and ratification, MCSGFC’s advice. legitimate claims shall be sent to the IPF Trust for disbursement of the amount immediately.

• The provisions of this circular shall come into effect from January 1^st, 2022.
• The Stock Exchanges are advised to:

Make necessary amendments to the relevant byelaws, rules and regulations.

Communicate to SEBI, the status of the implementation of the provisions of this circular through the Monthly Development Report (MDR).

• This Circular is issued in exercise of the 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. All other provisions of the relevant circular will continue to be in force

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