Every bullion exchange must establish a Consumer Education and Protection Fund. The fund is intended to promote consumer education and provide compensation to consumers where bullion trading members default, in accordance with requirements specified by the Authority.

Bullion exchanges and bullion clearing corporations must appoint a Chief Information Security Officer separately from the Chief Technology Officer. The Chief Information Security Officer oversees the entity's cyber security posture and reports directly to the Managing Director or Chief Executive Officer.

Appointment of a Chief Legal Officer is mandatory for bullion exchanges and bullion clearing corporations that are not subsidiaries or joint ventures of market infrastructure institutions. Subsidiaries and joint ventures may rely on parental legal assistance, but must appoint a Chief Legal Officer if that assistance is unavailable. The Authority may require appointment based on operational size and scale. The Chief Legal Officer mitigates legal risk by vetting bye-laws, amendments, cross-border legal documents, and undertaking functions assigned by the governing board or the Authority.

Chief Risk Officer appointment is mandatory for every bullion exchange and bullion clearing corporation. The officer must identify and monitor operational risks, initiate necessary mitigation measures, oversee overall risk management, and submit a half-yearly risk-management report to the Authority within 90 days after each half-year ends.

Every bullion exchange and bullion clearing corporation must appoint a Compliance Officer to monitor compliance with applicable legal and regulatory requirements and redress customer grievances. The Compliance Officer must independently and immediately report observed non-compliance to the Authority and submit a quarterly non-compliance report within 45 days after each quarter ends, in the prescribed manner.

Statutory committees must be constituted by every bullion exchange and bullion clearing corporation in accordance with specifications issued by the Authority. The Authority determines which committees are required and prescribes their composition, quorum and functions. Committee establishment and operation remain subject to the specified framework governing membership structure, quorum requirements and assigned functions.

Segregation of functions requires bullion exchanges and bullion clearing corporations to classify activities into critical operations; regulatory, legal, compliance, risk management and customer-grievance functions; and other functions, including business development. The first two verticals must receive priority in resource allocation over other functions, and their resource adequacy must be assessed periodically and objectively.

Code of Conduct compliance is mandatory for the governing board, directors, committee members and key management personnel of bullion exchanges and bullion clearing corporations. Directors and key management personnel must satisfy fit and proper person requirements, while persons aware of wrongdoing must immediately report it to the governing board or the Authority. Non-compliance or conflicts of interest may result in appropriate action, including removal or termination of appointment, subject to an opportunity of being heard.

Prior approval of the Authority governs the appointment, renewal, removal or termination of a managing director, including compensation and any change to compensation terms. Appointments are limited to five years per term, require a fresh process after the first term, and cannot exceed ten years in total or continue beyond sixty-five years of age. Shareholding, member-related and concurrent-position conflicts are prohibited. Removal for non-compliance requires prior Authority approval, while Authority-initiated removal or termination requires an opportunity of being heard.

Appointments and reappointments of non-independent directors, and appointments of public interest directors, to bullion exchange and bullion clearing corporation governing boards require prior approval of the Authority. Public interest directors have a renewable three-year term subject to performance review and an age-based eligibility limit. They are subject to restrictions on concurrent board positions, conflict disclosure obligations, and a three-year cooling-off period before becoming non-independent directors or joining the relevant subsidiary's board. Appointment applications must follow the prescribed Schedule I procedure.

Governing boards of bullion exchanges and bullion clearing corporations must maintain public interest director parity with non-independent directors and elect the chairperson from public interest directors with prior approval. Trading and clearing members, their associates and agents are generally excluded from board membership, subject to specified institutional exceptions. Quorum and voting validity depend on equivalent or greater participation by public interest directors. Boards must collectively hold prescribed market, financial, legal, technological, risk-management and administrative expertise, with designated public interest director expertise in core fields.

Bullion exchanges and bullion clearing corporations must, alongside requirements under other applicable laws, maintain and preserve all books, registers, documents and records relating to the issue or transfer of their securities for at least eight years.

Bullion exchanges and bullion clearing corporations must submit their shareholding pattern to the Authority every quarter within fifteen days after the quarter ends. The filing must list the ten largest shareholders, including the number and percentage of shares held by each, and identify shareholders who acquired shares during the relevant quarter. This establishes continuing regulatory disclosure of institutional ownership and quarterly share acquisitions.

Bullion exchanges and bullion clearing corporations must maintain an adequate monitoring mechanism to ensure continuous compliance with prescribed shareholding conditions.

Direct or indirect holders of equity shares or voting rights in a bullion exchange or bullion clearing corporation must be fit and proper persons, subject to an exception for holdings below two per cent. Holdings exceeding five per cent of paid-up equity shares or voting rights require prior approval of the Authority. The application must be routed through the concerned bullion exchange or bullion clearing corporation, which must verify shareholder declarations or undertakings and submit the application with its recommendation.

Shareholding in a bullion clearing corporation requires minimum institutional ownership through a recognised bullion exchange, stock exchange, clearing corporation, or a qualifying joint venture of market infrastructure institutions. A joint venture must have majority ownership by recognised bullion exchanges or stock exchanges. Other persons, whether acting individually or in concert, are subject to a maximum holding limit in the paid-up equity share capital of the bullion clearing corporation.

Shareholding in a bullion exchange must be held either by a recognised bullion exchange or stock exchange with at least twenty-six per cent of paid-up equity capital, or by a joint venture of recognised market infrastructure institutions holding at least fifty-one per cent. Recognised exchanges must directly or indirectly hold at least fifty-one per cent in such joint venture. Other persons may not acquire or hold more than twenty-five per cent, individually or with persons acting in concert.

Ownership limits for a bullion exchange or bullion clearing corporation apply to a person's shareholding or voting rights at all times, subject to the limits prescribed in the relevant Chapter and any contrary provision within the regulations. Shareholding includes instruments owned or controlled directly or indirectly that confer a present or future entitlement to equity or rights over equity.

Every bullion exchange and bullion clearing corporation must maintain a minimum net worth of USD 10 million at all times, subject to a higher requirement that may be imposed as a risk-management measure based on the nature and scale of business. Profit distributions to shareholders are prohibited until the prescribed net worth is achieved. An audited annual net worth certificate issued by the statutory auditor must be submitted for the preceding financial year by 30 September.

Every bullion clearing corporation must maintain an orderly winding-down framework for its critical operations and services in voluntary and involuntary scenarios. The framework must provide for timely settlement, cessation or transfer of positions and for transfer of members' collateral, deposits, margins and other assets to a bullion clearing corporation taking over the operations. It must also cover related matters necessary for an orderly transition or cessation of clearing functions.