Depositing bullion into an empanelled vault requires the depositor to submit a deposit request to a vault empanelled with a bullion depository. The vault manager or its authorised person must ensure execution of requisite documentation before deposit. The vault manager must also ensure that the bullion meets the Authority-specified good delivery standard and, when directed, engage an assayer at the time of deposit to test that standard.

Bullion depository receipts may be issued only in accordance with the applicable regulatory requirements governing such instruments. Issuance outside the prescribed framework is prohibited.

Vault managers must keep complete and accurate electronically retrievable records and accounts of vaulting transactions, including bullion received and withdrawn and bullion depository receipts issued. Vault-business records must be maintained in numerical sequence, separately from other business records, in the form, manner, and retention period specified by the Authority or relevant bullion depository. They must be available for inspection when required by the Authority, bullion exchange, or bullion depository.

Vault manager liability applies to loss of or injury to stored bullion. Damage or loss despite reasonable care requires compensation based on the bullion's value at deposit, while negligence requires compensation based on its value on the date of damage or loss. No responsibility arises for loss, destruction, damage or deterioration caused by a force-majeure event. Vault managers must maintain adequate insurance for risks specified by the bullion depository or the Authority.

Registration of vault managers requires an application in the prescribed form and manner, accompanied by an undertaking accepting applicable liabilities. Eligibility requirements may include prescribed net worth and infrastructure for operating bullion-storage vaults. Registration may be granted upon satisfaction of the applicable requirements, and an applicant must receive an opportunity of being heard before rejection.

A bullion depository must indemnify a beneficial owner for loss arising from the wrongful act, negligence or default of the depository or a participant. Where the depository indemnifies loss attributable to a participant's negligence, it may recover the indemnified amount from that participant.

Regulation 50 requires bullion depositories to furnish vault managers with details of bullion transfers in the names of beneficial owners, in accordance with their bye-laws. Vault managers must provide bullion depositories with specified relevant records relating to bullion held by them. A bullion depository may empanel only a vault manager registered with the Authority.

Pledge or hypothecation of a Bullion Depository Receipt by a beneficial owner requires previous approval of the bullion depository. Every beneficial owner must intimate the bullion depository of the pledge or hypothecation, following which the bullion depository must make corresponding entries in its records. Such record entries are treated as evidence of the pledge or hypothecation.

Every bullion depository must maintain a register and an index of beneficial owners in the manner specified by the Authority. The requirement operates within the framework governing the rights and obligations of bullion depositories, participants and beneficial owners.

Bullion depositories may transfer ownership of bullion depository receipts for beneficial owners but have no other rights over the underlying bullion. Beneficial owners retain all rights and benefits, and bear all liabilities, relating to their bullion depository receipts.

Every bullion depository must register a transfer of a Bullion Depository Receipt in the transferee's name upon receiving intimation. The intimation may be received directly or through a participant, and the obligation ensures that notified transfers are reflected in the depository's records.

Access to bullion depository services is available to any person directly or through a participant, subject to entering into an agreement with a bullion depository. The agreement must be in the form specified by the applicable bye-laws.

A bullion depository may, where the Authority so desires, enter into an agreement appointing one or more participants as its agents. The agreement must be in the form specified in the bullion depository's bye-laws.

Registration of a bullion depository requires additional safeguards, including bye-laws and legal documentation aligned with its objectives and consumer protection. The depository must have an agreement with a vault manager possessing the infrastructure and standards necessary for safe bullion storage. Before approving commencement of operations, the Authority physically verifies the infrastructure facilities and systems established by the bullion depository.

Recognition, commencement of business, net worth, ownership and governance requirements applicable to depositories under the IFSCA (Market Infrastructure Institutions) Regulations, 2021 apply, mutatis mutandis, to bullion depositories. Those established depository standards are thereby adapted to regulate bullion depositories' recognition, operational commencement, financial strength, ownership structure and governance arrangements within the bullion market framework.

Contracts between bullion exchange members, bullion clearing members and consumers must be in writing. Enforcement is governed by the applicable rules and bye-laws of the relevant bullion exchange or bullion clearing corporation.

Membership qualification criteria for a bullion exchange or bullion clearing corporation must be set out in bye-laws. These must cover organisational structure, professional employees' qualifications and experience, financial-strength thresholds, minimum net-worth requirements, disqualifications, membership categories, and limits on trading, clearing, or settlement activity. The framework must also prescribe membership application procedures and measures to prevent conflicts of interest and promote ethical conduct.

Every bullion exchange and bullion clearing corporation must establish a framework governing the sharing and monitoring of confidential and sensitive data. The framework must specify sharing methods, permitted data types, and an escalation matrix. It must maintain a digital database of information shared, recipients, and reasons for sharing, supported by technology-enabled monitoring and periodic compliance audits. Individual accountability must be assigned for breaches of the data-sharing policy.

Bullion clearing corporations must establish and publish a policy framework for non-discriminatory clearing and settlement access for shareholder and non-shareholder bullion exchanges. The framework must specify the basis for shareholder access and the compliance requirements for non-shareholder access. Bullion exchanges and clearing corporations must provide equal, unrestricted, transparent and fair access to all persons without bias toward associates or related entities. Non-discriminatory access issues are conclusively determined by the Authority.

Utilization of profits and investments by a bullion exchange and bullion clearing corporation must comply with norms specified by the Authority. Fund deployment or other activities require prior approval, except treasury investments made under a governing-board-approved investment policy. Unrelated or non-incidental fund-deployment activities may be undertaken through a separate legal entity, subject to the Authority's approval.