Utilization of Fund Created out of the Regulatory Fee Forgone by SEBI – Additional Guidelines
Summary
This circular permits stock exchanges to utilize funds created from regulatory fees forgone by SEBI for additional activities benefiting farmers and FPOs. It specifically allows reimbursement of mandi taxes, processing charges, option premiums, and clearing corporation fees. Stock exchanges are required to revise their action plans, disclose fund utilization monthly, and amend their bye-laws accordingly.
Text
Stock Exchanges have been permitted by SEBI to utilize the said fund exclusively for the benefit of and easy participation by Farmers / FPOs in the agricultural commodity derivatives market, in accordance with the guidelines specified vide SEBI circular no. SEBI/HO/CDMRD/DMP/CIR/P/2019/40 dated March 20, 2019.
Reimbursement of Mandi tax including any other mandi cess or whatever name it may be called, levied against the goods deposited in warehouses accredited with Clearing Corporations for the purpose of delivering on Exchange platform for which exchange specific Electronic Negotiable Warehouse Receipt (eNWR) is generated.
Farmers/FPOs can be reimbursed the charges incurred towards assaying, cleaning, drying, sorting, storage and transportation in respect of goods deposited in warehouses accredited with Clearing Corporations with an intention to deliver them on Exchange Platform for which exchange specific eNWR is generated.
The Farmers / FPOs can be incentivized to participate in “options in goods”. For this purpose, the Farmers / FPOs can be reimbursed a certain percentage or fixed amount of the premium paid by them, for purchasing “options in goods” on the exchange platform.
Fees/cost levied by Clearing Corporation, if any, on Farmers/FPOs in the process of their participation in commodity derivatives trading can be reimbursed.
The Stock Exchanges can revise their action plan for utilisation of regulatory fee foregone by SEBI for FY 2020-21 incorporating the abovementioned activities and the revised plan, if any, shall be disseminated on their website.
in order to enhance transparency, the Stock Exchanges are advised to make disclosure regarding the corpus of the fund and its utilization, on their website, on a monthly basis.
The Stock Exchanges are further advised to include the details of the corpus of the fund and its utilization in the Monthly Development Report (MDR).
All other extant provisions of the circular dated March 20, 2019 shall continue to remain in force.
The provisions of this circular shall be effective from the date of this circular.
This 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 market.
to make necessary amendments to the relevant bye-laws, rules and regulations;
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Source: SecMarx — Utilization of Fund Created out of the Regulatory Fee Forgone by SEBI – Additional Guidelines. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.