Directors and key management personnel of recognised market infrastructure institutions must comply with the Authority-specified Code of Ethics and Code of Conduct. For non-compliance with applicable regulations or codes, or for a conflict of interest, the Authority may act on an institutional reference or on its own motion. After providing a reasonable opportunity of being heard, it may take appropriate action, including removal or termination of appointment.

Recognised market infrastructure institutions must maintain boards comprising non-independent directors, public interest directors and a managing director. Public interest directors must elect the chairperson and cannot be fewer than non-independent directors. Director appointments require prior approval, while specified nominees of broker dealers, clearing members and depository participants are barred, subject to exceptions for nominees of scheduled commercial banks or public financial institutions. Public interest director and managing director tenure, age limits and reappointment procedures apply. Boards must document conflict-of-interest procedures and regularly assess board and individual director performance.

Recognised market infrastructure institutions must continuously ensure that directors, key management personnel and shareholders are fit and proper. Fitness requires fairness, integrity, financial integrity, good character and honesty, and absence of prescribed disqualifications, including relevant convictions, pending regulatory recovery proceedings, insolvency, financial unsoundness, wilful default, regulatory restraints, and securities-market-related orders. Listed institutions and acquirers share responsibility for shareholder fitness where the acquired holding reaches the prescribed threshold.

Listing of securities by a recognised market infrastructure institution requires prior approval of the Authority. After obtaining approval, the institution may apply to any stock exchange for listing. Regulatory approval is therefore a precondition to initiating a listing application, while listing may be sought on any stock exchange once that condition is satisfied.

Recognised market infrastructure institutions must submit their shareholding pattern to the Authority quarterly within fifteen days after each quarter ends. Disclosures must identify the ten largest shareholders, with their number and percentage of shares, and name shareholders who acquired shares during the relevant quarter. This establishes periodic transparency over significant ownership and new share acquisitions.

Recognised market infrastructure institutions must maintain an adequate shareholding monitoring mechanism for continuous compliance with applicable shareholding conditions. Monitoring must operate at all times and requires ongoing oversight of shareholding arrangements rather than periodic or reactive verification alone.

Acquisition of equity shares or voting rights representing ten per cent or more of the paid-up equity share capital of a recognised market infrastructure institution requires prior approval. The acquirer must not have a conflict of interest. The institution must verify fit-and-proper declarations and undertakings, then forward the application with its recommendation for approval.

Regulation 18 requires a recognised depository to have minimum qualifying ownership through either a recognised depository or a joint venture of eligible market infrastructure institutions. Other persons may not acquire or hold more than twenty-five per cent of paid-up equity share capital, directly or indirectly, individually or with persons acting in concert. The joint-venture route replaced the earlier consortium route with effect from 1 November 2024.

Shareholding in a recognised clearing corporation must be anchored by eligible market infrastructure institutions. A recognised stock exchange or clearing corporation must hold at least twenty-six per cent of paid-up equity capital, or an eligible consortium must hold at least fifty-one per cent, with recognised stock exchanges holding a majority within the consortium. Other persons may not directly or indirectly, alone or with persons acting in concert, acquire or hold more than twenty-five per cent of paid-up equity capital.

Regulation 16 requires a prescribed ownership structure for a recognised stock exchange. A stock exchange recognised in India or a foreign jurisdiction must hold at least twenty-six per cent of paid-up equity share capital. A qualifying joint venture of market infrastructure institutions is also specified, with a minimum fifty-one per cent holding in the paid-up equity share capital of a recognised clearing corporation. Other persons, alone or acting in concert, cannot directly or indirectly exceed the twenty-five per cent cap in the recognised stock exchange.

Recognised market infrastructure institutions must submit an audited net worth certificate from their statutory auditor each year by 30 September for the preceding financial year. Net worth of recognised stock exchanges and depositories is based on paid-up equity capital and eligible free reserves, subject to prescribed exclusions and deductions. A clearing corporation's net worth is determined by its aggregate liquid assets, including cash, bank balances, fixed deposits, Government securities and other specified instruments.

Recognised market infrastructure institutions must maintain a minimum net worth of USD 3 million at all times. The Authority may prescribe a higher net-worth requirement as a risk-management measure, having regard to the nature and scale of the institution's business.

Withdrawal of recognition of a market infrastructure institution may be undertaken by the Authority only after the institution is given a reasonable opportunity of being heard. Recognition of a stock exchange or clearing corporation must be withdrawn in accordance with the procedure prescribed under section 5 of the SCRA.

Renewal of recognition for a market infrastructure institution is subject to the same applicable regulatory provisions governing the grant of recognition. An application for renewal must satisfy the relevant recognition requirements under the International Financial Services Centres Authority (Market Infrastructure Institutions) Regulations, 2021.

Recognised market infrastructure institutions must pay the regulatory fee specified by the Authority from time to time under the International Financial Services Centres Authority (Market Infrastructure Institutions) Regulations, 2021.

Recognition of a market infrastructure institution may be granted permanently or for a period specified by the Authority, which must be at least one year.

Recognition as a stock exchange, clearing corporation or depository may be granted after the Authority considers the application and is satisfied that the applicant meets the prescribed conditions and eligibility requirements. The Authority may attach appropriate conditions to recognition. A recognised market infrastructure institution must also comply with additional conditions imposed from time to time.

Recognition of a stock exchange or clearing corporation requires incorporation as a company limited by shares, demutualisation, fit-and-proper status, compliance with ownership, governance and net-worth requirements, and requisite financial capacity, expertise and infrastructure. Stock exchanges require orderly trading, real-time surveillance, member regulation, investor redressal, information dissemination, systems resilience and skilled personnel. Clearing corporations require clearing and settlement infrastructure, risk management, settlement guarantees, connectivity, real-time controls and dispute arrangements. Depositories require secure data and communication systems, operational controls, backups and indemnification of beneficial owners.

Input tax credit on tax paid through DRC-03 under section 73 is not automatically blocked by section 17(5)(i), but remains subject to general eligibility conditions and the nature of the underlying transaction. Payment relating to an eligible inward supply may support credit, while reversal of wrongly availed credit cannot be reclaimed merely because payment is made under section 73. DGGI investigation alone does not necessarily require section 74, although a contrary view treats post-detection payment as indicating fraud, wilful misstatement, or suppression.

Recognition of a depository in an IFSC requires the application to include a copy of the depository's draft bye-laws as part of the recognition process.