Financial Service Provider classification excludes SEBI registered brokers from insolvency petitions, challenging their admissibility under the Code. SEBI-registered stock brokers and sub-brokers are Financial Service Providers under the Insolvency and Bankruptcy Code, regulated by a financial sector ... Summary
Financial Service Provider classification excludes SEBI registered brokers from insolvency petitions, challenging their admissibility under the Code.
SEBI-registered stock brokers and sub-brokers are Financial Service Providers under the Insolvency and Bankruptcy Code, regulated by a financial sector regulator and subject to SEBI obligations. Section 5(8)(g) on derivative valuation must be read with other definitional provisions and does not extend Section 7 insolvency petitions to cover Financial Service Providers; reliance on that provision to admit a Section 7 petition against such a broker was held to be a misconstruction rendering the initiation nonmaintainable.
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