Recognised depositories must maintain systems and procedures that enable coordination with issuers or their agents and participants for daily reconciliation of securities ownership records. The requirement is directed at ensuring accurate and current ownership records within the depository framework.

Dematerialisation of securities requires an issuer to enter into an agreement with a recognised depository when the issuer or an investor exercises the option to hold securities in dematerialised form. No agreement is required where the depository is itself the issuer or where government securities are issued by the Central Government of India or a State Government. Where a Registrar to the Issue or Share Transfer Agent is appointed, the depository, issuer and registrar or agent must execute a tripartite agreement for securities declared eligible for dematerialised holding.

Regulation 45 requires a recognised depository to enter into an agreement with one or more participants acting as its agents. The arrangement establishes the required agency relationship between the depository and its participant or participants.

Securities defined under the SCRA and other eligible instruments under the IFSCA Act may be held in dematerialised form in a recognised depository.

Priority of clearing corporation recovery applies to dues arising from clearing members' clearing and settlement functions. A recognised clearing corporation may recover these dues from the clearing members' collateral, deposits and assets, with priority over every other liability of or claim against the clearing members.

Recognised clearing corporations handling physically settled commodity derivatives must ensure a financial guarantee for trade settlement, including good delivery. Good delivery requires goods to be capable of transferring title and to conform to the quality and quantity specifications of the relevant exchange contract.

Payment and settlement must follow netting or gross procedures contained in approved bye-laws of recognised stock exchanges and recognised clearing corporations. Such settlements are final, irrevocable and binding once the payable money, securities or other transaction obligations are determined, even without actual payment or delivery. Following finality, rights to appropriate contributed collateral, deposits and margins for settlement or other obligations take priority over other liabilities or claims against trading members, clearing members or clients.

Recognised stock exchanges and recognised clearing corporations must obtain prior approval of the Authority before making bye-laws governing contracts, clearing, and settlement. Amendments to such bye-laws also require prior approval. The same approval requirement applies to amendments of memoranda of association, articles of association, and other constitutional documents where they concern matters under the Securities Contracts (Regulation) Act or these regulations.

Recognised stock exchanges must preserve prescribed books, account documents, and further specified records in electronic retrieval form for at least twenty years. Recognised clearing corporations are subject to the same retention format and period for governance minutes, clearing member and settlement account details, transaction and deposit records, margin information, accounting books, bank statements, and further specified records.

Equal, fair and transparent access to clearing and settlement services requires recognised clearing corporations to maintain and publish a non-discriminatory access framework. The framework must state the basis for shareholder stock exchange access and the requirements non-shareholder stock exchanges must satisfy to obtain access. Recognised stock exchanges and clearing corporations must provide equal, unrestricted and transparent access to all persons without favouring associates or related entities.

Utilization of profits and investments by a recognised stock exchange or recognised clearing corporation must comply with norms specified by the Authority. Deployment of funds generally requires prior approval. Treasury investments are exempt where they comply with a governing-board-approved investment policy. Activities involving fund deployment or otherwise unrelated or not incidental to market infrastructure functions may be undertaken through a separate legal entity, subject to the Authority's approval.

Recognised stock exchanges and recognised clearing corporations must maintain a Business Continuity Plan and a Disaster Recovery Site. The arrangements must preserve data and transaction integrity in the manner specified by the Authority from time to time.

Recognised stock exchanges providing co-location facilities must supervise and monitor them to maintain the integrity, security and privacy of data and trading systems. They must ensure equal and fair access for participants and publish quarterly reports on exchange-observed latencies on their websites.

A recognised stock exchange must maintain a procedure to halt trading in the market or an individual scrip in response to volatility or before major company-specific announcements. The trading-halt mechanism is intended to promote fair and orderly trading.

Recognised stock exchanges must establish detailed product-specific position-limit frameworks. Recognised clearing corporations must maintain risk management frameworks aligned with the CPMI-IOSCO Principles for Financial Market Infrastructures, adopt globally consistent margining practices, maintain sufficient capital for key risks, and conduct stress and liquidity testing. Eligible collateral includes cash, specified securities and gold, while cash and cash equivalents must constitute at least 50% of total liquid assets. Clearing corporations must also be ring-fenced from holding companies and maintain additional capital for orderly recovery or wind-down.

Trading hours for all product categories on recognised stock exchanges are determined on the basis of cost-benefit analysis, subject to a daily maximum of 23 hours and 30 minutes. Settlement must occur at least twice daily. Recognised stock exchanges and recognised clearing corporations must ensure that their risk-management systems and infrastructure remain commensurate with trading hours at all times.

Recognised clearing corporations must establish and maintain a Settlement Guarantee Fund to guarantee settlement of stock-exchange trades. Its corpus must be at least the higher of the minimum corpus determined through monthly stress-test values or USD 1 million. The fund must be used to complete settlement when a recognised clearing member defaults, remain adequate for resulting obligations, undergo periodic stress testing, and operate under a detailed framework approved by the Authority.

A recognised stock exchange must establish an Investor Education and Protection Fund in accordance with requirements specified by the Authority. This forms part of the general obligations applicable to recognised stock exchanges under the Market Infrastructure Institutions regulatory framework.

Admission of securities requires a recognised stock exchange or recognised clearing corporation to obtain the Authority's prior approval before introducing or offering settlement services for any new category of securities.

A recognised stock exchange must use a recognised clearing corporation for clearing and settlement of its trades under an agreement between them. It must also extend its arbitration mechanism to resolve disputes or claims arising from the clearing and settlement of trades executed on the exchange.