Measures to instill trust in securities market – Expanding the framework of Qualified Stock Brokers (QSBs) to more stock brokers

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....rcular no. SEBI/HO/MIRSD-PoD-1/P/CIR/2023/24 dated February 06, 2023 and para 18 of Master Circular for Stock Brokers dated May 17, 2023 inter-alia stated that the following four parameters shall be considered for designating a stockbroker as QSB, on an annual basis: 1.1. the total number of active clients of the stock broker; 1.2. the available total assets of clients with the stock broker; 1.3. the trading volumes of the stock broker (excluding the proprietary trading volume of the stock broker); 1.4. the end of day margin obligations of all clients of a stock broker (excluding the proprietary margin obligation of the stock broker in all segments) 2. Based on the aforementioned parameters, the first list of QSBs was issued ....

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....edure shall be followed for identifying a stock broker as QSB: 4.2.1. For each stock broker, the percentage (%) of a particular parameter compared to aggregate of the respective parameter summed across all stock brokers shall be calculated, viz. % of count of active clients for a particular broker shall be calculated by dividing the individual count of active clients for a particular broker by total number of active clients of all the stock brokers and the value is multiplied by 100. Similarly, individual % shall be calculated for all the parameters mentioned at para 4.1.1 to 4.1.7 above. 4.2.2. Based on the % of various parameters calculated above, the following stock brokers shall be identified as QSBs: 4.2.2.1. Stock brokers wit....

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....ities, it has been decided to facilitate stockbrokers to voluntarily get designated as QSBs, who otherwise would not have qualified to become QSBs by virtue of the parameters enumerated at para 4.1. 4.6. Such voluntarily designated QSBs shall have to abide by all the enhanced obligations and responsibilities for QSBs stated at para 18.5 and 18.6 of the master circular including such other provisions as may be prescribed by SEBI/stock exchanges from time to time. The detailed operational modalities in this regard shall be issued by stock exchanges, in consultation with SEBI. 5. Applicability: 5.1. The provisions of this circular shall come into force in a risk-based, staggered manner to ensure smooth adoption and effective implement....