TMI BlogQualifications for membership of a recognised stock exchangeX X X X Extracts X X X X X X X X Extracts X X X X ..... al financial liability unless he undertakes on admission to sever his connection with such business : 3 [***] 4 [Provided that nothing herein shall be applicable to any corporations, bodies corporate, companies or institutions referred to in clauses (a) to (n) of sub-rule (8).] (g) 5 [***] (h) he has been at any time expelled or declared a defaulter by any other stock exchange; (i) he has been previously refused admission to membership unless a period of one year has elapsed since the date of such rejection. (2) No person eligible for admission as a member under sub-rule (1) shall be admitted as a member unless :- (a) he has worked for not less than two years as a partner with, or an authorised assistant or authorised clerk or remisier or apprentice to, a member; or (b) he agrees to work for a minimum period of two years as a partner or representative member with another member and to enter into bargains on the floor of the stock exchange and not in his own name but in the name of such other member ; or (c) he succeeds to the established business of a deceased or retiring member who is his father, uncle, brother or any other person who is, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the directors of such company are shareholders of such company and also members of that stock exchange; and (iii) the directors of such company, who are members of that stock exchange, have ultimate liability in such company. 11 [***] (4A) A company as defined in the Companies Act, 1956 (1 of 1956), shall also be eligible to be elected as a member of a stock exchange if- (i) such company is formed in compliance with the provisions of section 12 of the said Act; (ii) such company undertakes to comply with such financial requirements and norms as may be specified by the Securities and Exchange Board of India for the registration of such company under sub-section (1) of section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992); (iii) 12 [* * *] (iv) the directors of the company are not disqualified from being members of a stock exchange under 13 [clause (1) [except sub-clause (b) and sub-clause (f) thereof] or clause (3) [except sub-clause (a) and sub-clause (f) thereof]] and the Directors of the company had not held the offices of the Directors in any company which had been a member of the stock exchange and had been declared def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15 of 1948); (b) the Industrial Development Bank of India, established under the Industrial Development Bank Act, 1964 (18 of 1964); (c) any insurance company granted registration by the Insurance Regulatory Development Authority under the Insurance Act, 1938 (4 of 1938); (d) the Unit Trust of India, established under the Unit Trust of India Act, 1963 (52 of 1963); (e) the Industrial Credit and Investment Corporation of India, a company registered under the Companies Act, 1956 (1 of 1956); (f) the subsidiaries of any of the corporations or companies specified in clauses (a) to (e) and any subsidiary of the State Bank of India or any nationalised bank set up for providing merchant banking services, buying and selling securities and other similar activities; (g) any bank included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934); (h) the Export Import Bank of India, established under the Export Import Bank of India Act, 1981 (28 of 1981); (i) the National Bank for Agriculture and Rural Development, established under the National Bank for Agriculture and Rural Development Act, 1981 (61 of 1981); (j) the National Housing Bank, establis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) nothing herein shall affect members of a recognized stock exchange permitted under the proviso to clause (f) of sub-rule(1) to suspend the enforcement of the aforesaid clause, for so long as such suspension is effective, except that no member of such exchange shall engage in forward business of any kind whether in goods or commodities or otherwise and , if actually so engaged on the date of such application , he shall sever his connection with any such business within a period of three years from the date of the grant of recognition. 10 Substituted for items (a) to (n) of the proviso to sub-rule (4) , by the Securities Contracts (Regulation) (Second Amendment) Rules, 2017, w.e.f. 27.06.2017. Prior to this, Substituted (a) to (k) by Securities Contracts (Regulation) (Amendment) Rules, 2014, w.e.f.16.1.2014 11 Omitted by the Securities Contracts (Regulation) (Amendment) Rules, 2017, w.e.f. 20.03.2017. Prior to omission the proviso read as under- Provided that where the 17 [Securities and Exchange Board of India] makes a recommendation in this regard, the governing body of a stock exchange shall, in relaxation of the requirements of this clause, admit as me ..... X X X X Extracts X X X X X X X X Extracts X X X X
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