The National Commodity & Derivatives Exchange Limited (NCDEX) on December 02, 2024, issued a circular regarding the Client Code Modification.
To minimize order entry errors and deter client code modifications, a penalty framework has been established to address all aspects of Client Code Modifications (CCM). Accordingly, a structured penalty system has been implemented for specific aspects of CCM.
The updated framework for the Client Code Modification penalty is as under:
• Penalty on Client Code Modification where either original code or modified client code is non-institutional client category
• Maintenance of Error Account
• Squaring off trades before transferring to ERROR account
• Penalty for modification of client code from ERROR account to another client Code
• Penalty for Keeping Open position for more than 3 working days in ERROR account
• Institutional Trade Modification Penalty
• Procedure of waiver of penalty
The Trading Members may kindly note that the request for waiver of penalty along with reasons and relevant supporting documents should be submitted to the Exchange within three (3) working day from the date modification failing which request for waiver shall not be accepted.
Not more than one such waiver per quarter may be given to a stock broker for modification in a client code. Explanation: If penalty wavier has been given with regard to a genuine client code modification from client code AB to client code BA, no more penalty waivers shall be allowed to the stock broker in the quarter for modifications related to client codes AB and BA.
The provisions of the circular shall be effective from December 05, 2024.
[Circular No: NCDEX/SURVEILLANCE & INVESTIGATION-133/2024]
