BSE Circular on - Revised Penalty Structure w.r.t Unauthorised trades executed in the clients’ account
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Date of Issue:7-7-2025
Issuer: BSE
Revised Penalty Structure w.r.t Unauthorised trades executed in the clients’ account
Highlights of BSE Circular dated July-7-2025
In continuation to
earlier modification to Exchange Notice Nos. 20180214-31 dated February 14, 2018, 20210324-45 dated March 24, 2021, and 20231121-12 dated November 21, 2023 specifying the
penalty norms for unauthorized trades executed by the members in the account of
client.
In partial modification of the said notices the word “conciliation” has been
dropped in Point no. b of contravention and under the head penalty I and II
(a).
The revised penalty is as follows:
In case the Trading
Member challenges the observation of Arbitrator/s and the same is reversed at
the higher forum, the penalty levied will be returned to the member.
The revised penalty structure shall be applicable from the date of issue of
this notice.
In case of any clarification or assistance required in the implementation of this circular, you may contact
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secmarkupdates
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Contact: 9869265949,9870210171, in...@secmark.in, kau...@secmark.in
Date of Issue:7-7-2025
Issuer: BSE
Revised Penalty Structure w.r.t Unauthorised trades executed in the clients’ account
Highlights of BSE Circular dated July-7-2025
In partial
modification to ICCL circular no. 20240814-8 dated August 14, 2024, Trading Members/
Clearing Members are hereby informed that, effective August 01, 2025,
penalties will be levied for position limit violations in the Equity Derivative
and Currency Derivative segments as per the below mentioned norms.
Participants are required to adhere to the position limits as specified by SEBI
from time to time. In case of any violation of open position limits beyond the
specified thresholds for a security/ Currency pair/ Interest Rate Derivative at
any level (e.g. member level, financial institution level, client level, etc),
a penalty shall be levied on a monthly basis. This will be based on slabs
mentioned below, or such other amount as specified by the Clearing Corporation
periodically.
Penalty structure for FPI /Mutual Fund/ Trading member level position limit violation in Currency and Equity Derivatives:
The instances
referred above include all instances of position limit breaches occurring
within a single calendar month. Penalties will be levied based on the number of
position limit violations by a trading member across all underlying’s within a
calendar month.
Penalty structure for Client/NRI/ scheme of MF level position limit
violation in Equity Derivatives:
When the open position of any client in any security, exceeds the specified
limit at the end of the day the same shall be treated as a violation.
In the event of violation, the following penalty will be charged to the
clearing members for each day of violation:
- 1% of the value of the quantity in violation (i.e., excess quantity over the allowed quantity, valued at the closing price of the security in the normal market of the Capital Market segment of the Exchange) per client, or
- Rs.1,00,000 per client, whichever is lower, subject to a minimum penalty of Rs.5,000/- per violation / per client.
When the client level/NRI/scheme of mutual fund violation is on account of open position exceeding 5% of the open interest, a penalty of Rs.5000/- per instance shall be levied to the clearing member.
Penalty
structure for Client level position limit violation in Currency derivatives:
When the open position of any client in
Currency pair/ Interest Rate Derivative, exceeds the specified limit at the end
of the day the same shall be treated as a violation.
In the event of violation, a penalty of Rs. 5,000/- per violation per client
shall be levied to the Clearing members for each day of violation.
The above penalties shall be collected from the clearing member of the
respective trading member and client. The concerned Clearing / Trading member
may, in turn, recover such penalty amounts from the clients who committed the
violation and are liable therefore.