Master Circular on Surveillance of Securities Market
Summary
This part of the Master Circular consolidates previous surveillance circulars and establishes its effective date while rescinding older directives. It mandates that securities trade in the normal segment only if 100% of promoter shareholding is dematerialized, with specific rules for TFT trading during corporate actions or readmissions. Additionally, it imposes strict internal control obligations on market intermediaries to prevent the circulation of unauthenticated news and rumors by employees. This section mandates the maintenance of disclosures under SEBI PIT Regulations and requires prompt reporting of Code of Conduct violations to stock exchanges. It outlines procedures for remitting penalties to the Investor Protection and Education Fund and establishes system-driven disclosures for trading activities. Additionally, it defines exceptions to trading window closures and introduces automated PAN freezing mechanisms to restrict designated persons during closed periods. This section presents Annexure 1, which contains Form A1 for initial disclosures regarding securities holdings upon appointment as Key Managerial Personnel or Director. It also includes Form B2 for continual disclo
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The provisions of the relevant circulars have been consolidated in this Master Circular to ensure availability of consolidated information contained in all the circulars pertaining to surveillance of securities market at one place.
This Master Circular shall come into force from the date of its issue. This Master Circular rescinds the circulars listed in Annexure 7.
Anything done or any action taken... under the rescinded circulars... shall be deemed to have been done or taken under the corresponding provisions of this Master Circular; the previous operation... shall remain unaffected as if the rescinded circulars have never been rescinded.
This Master 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 interest of investors in securities and to promote the development of, and to regulate the securities market.
Securities of companies shall be traded in the normal segment of the stock exchange if and only if, the company has achieved 100% of promoter’s and promoter group’s shareholding in dematerialized form.
In the following cases... the trading shall take place in TFT segment for first 10 trading days with applicable price band while keeping the price band open on the first day of trading.
The stock exchange(s) shall ensure that before starting trading in scrips, the companies have complied with the disclosure requirements and the same is publicly disseminated on the website of the stock exchange(s).
SEBI Registered Market Intermediaries are directed that: Proper internal code of conduct and controls should be put in place.
Employees/temporary staff/voluntary workers etc. employed/working in the offices of market intermediaries do not encourage or circulate rumours or unverified information obtained from client, industry, any trade or any other sources without verification.
Access to social media platforms/ instant messaging services/ VoIP / Blogs/Chat forums/ websites/e-mail or any such medium should either be subject to controlled supervision or access should not be allowed.
Logs for any usage of such social media platforms/ instant messaging services/ VoIP / Blogs/Chat forums/websites/e-mail or any such medium shall be treated as records and the same should be maintained as specified by the respective regulations which govern the concerned intermediary.
Employees should be directed that any market related news received by them... should be forwarded only after the same has been seen and approved by the Compliance Officer of the concerned Intermediaries.
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Source: SecMarx — Master Circular on Surveillance of Securities Market. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.