Sunday, 3 November 2013

Simplified Procedures for Transmission of Securities

CIRCULAR No. CIR/MIRSD/10/2013,

Sub: Standardisation and Simplification of Procedures for Transmission of Securities

1. SEBI has reviewed the process being followed by the Share Transfer Agents (STAs) and the Depositories / Issuer companies (in-house STAs) for effecting transmission of securities held in physical as well as dematerialized mode.


2. With a view to make the transmission process more efficient and investor friendly, it has been decided in consultation with Registrars Association of India (RAIN) and the depositories, that STAs/ issuer companies and the depositories shall adhere to the following guidelines, as applicable to them:

I. In case of transmission of securities in dematerialized mode, where the securities are held in a single name without a nominee, the existing threshold limit of Rs. 1,00,000 (Rupees One lakh only) per beneficiary owner account has now been revised to Rs. 5,00,000 (Rupees Five lakh only), for the purpose of following simplified documentation, as already prescribed by the depositories vide bye-laws / operating instructions.

II. In case of transmission of securities held in physical mode:

a. where the securities are held in single name with a nominee, STAs/issuer companies shall follow the standardized documentary requirement as given in Annexure A.

b. where the securities are held in single name without a nominee, the STAs/issuer companies shall follow, in the normal course, the simplified documentation as given in Annexure A, for a threshold limit of ` 2,00,000 (Rupees Two lakh only) per issuer company. However, the Issuer companies, at their discretion, may enhance the value of such securities.
III. The timeline for processing the transmission requests for securities held in dematerialized mode and physical mode shall be 7 days and 21 days respectively, after receipt of the prescribed documents.

3. To improve the awareness of nomination facility, all Registrars to an Issue and Share Transfer Agents shall publicize nomination as an additional right available to investors, while sending communications to the investors.

4. All the stock exchanges are directed to make necessary amendments, wherever applicable, to the listing agreements for listing of various securities.

5. The depositories are directed to make necessary amendments, wherever applicable, to the relevant byelaws/ rules and regulations/circulars in this regard.

6. The circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, to protect the interests of investors in securities and to promote the development of, and to regulate the securities markets and shall be complied with at the earliest and not later than 45 days from the date of issue of the circular.

7. This circular is available on SEBI website (www.sebi.gov.in) under the categories “Legal Framework”and “Circulars”.

Yours faithfully,

Ruchi Chojer
General Manager
Tel.No: 022-26449310
E-mail id: ruchic@sebi.gov.in
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Annexure A

Documentary requirement for securities held in physical mode

1. For securities held in single name with a nominee:

i. Duly signed transmission request form by the nominee.

ii. Original or Copy of death certificate duly attested by a Notary Public or by a Gazetted Officer.

iii. Self attested copy of PAN card of the nominee. (Copy of PAN card may be substituted with ID proof in case of residents of Sikkim after collecting address proof)

2. For securities held in single name without a nominee, following additional documents may be sought:

a) Affidavit made on appropriate non judicial stamp paper – to the effect of identification and claim of legal ownership to the securities

b) For value of securities upto ` 2,00,000 (Rupees Two lakh only) per issuer company as on date of application, one or more of the following documents:

i. No objection certificate [NOC] from all legal heir(s) who do not object to such transmission (or) copy of Family Settlement Deed duly notarized or attested by a Gazetted Officer and executed by all the legal heirs of the deceased holder.

ii. Indemnity made on appropriate non judicial stamp paper – indemnifying the STA/Issuer Company.

c) For value of securities more than ` 2,00,000 (Rupees Two lakh only) per issuer company as on date of application:

i. Succession certificate (or) Probate of will (or) Letter of Administration (or) Court decree.

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