The Securities Exchange Board of India (SEBI) on October 27, 2022, issued a circular to clarify that the blocking mechanism will not be applicable to clients having arrangements with custodians registered with SEBI for clearing and settlement of trades with reference to SEBI circular no. CIR/HO/MIRSD/DOP/P/CIR/2022/595 dated July 16, 2021.
The SEBI had amended clause 5 of the circular dated July 16, 2021, vide circular no. SEBI/HO/MIRSD/DoP/P/CIR/2022/109 dated August 18, 2022, namely,
““5. The facility of block mechanism shall be mandatory for all Early Pay-In transactions.”
The following have been directed to Stock Exchanges and Depositories:
• bring the provisions of this circular to the notice of their members/participants and disseminate the same on their websites;
• make necessary amendments to the relevant Bye-laws, Rules, and Regulations for the implementation of the above decision;
• communicate to SEBI, the status of the implementation of the provisions of this circular on November 15, 2022, and in their Monthly Development Reports.
All other provisions in the SEBI circular dated July 16, 2021, and the SEBI circular dated August 18, 2022, will continue to remain applicable.
[Circular no. SEBI/HO/MIRSD/DoP/P/CIR/2022/143]
