Securities Law Flashcards
1
Q
Regulatory Fee of Stock Exchange and Clearing Corporation
A
Based on Annual Turnover
2
Q
What is annual turnover ?
A
Aggregate value of transactions in a financial year excluding agricultural commodity derivatives
3
Q
When should regulatory fee be paid paid
A
Within 30 days of the conclusion of the relevant financial period. The amount is specified in Part A Schedule III.
4
Q
Flat regulatory fee on transactions on agricultural commodity derivatives.
A
One lakh
5
Q
When should listing fee be paid ?
A
15 days from the end of each quarter of a financial year
6
Q
Listing fee to be paid within 15 days from the end of each quarter of a financial year.
A
10 percent of aggregate listing fees
7
Q
Listing fees of last quarter to be paid within?
A
30 days of end of the last quarter together with regulatory fee of that year
8
Q
Code of conduct of Recognized Stock Exchange and Recognized Clearing corporation?
A
Part A Schedule II
9
Q
Period of recognition granted to a clearing corporation unless granted on a permanent basis shall be ?
A
Not less than one year
10
Q
Repo Transaction means ?
A
Transaction in repo and reverse repo in the debt securities that are dealt and traded on a recognized stock exchange
11
Q
Application for Recognition as a stock exchange
A
Form A
Rules 3 of the rules
12
Q
Application for recognition as a clearing corporation
A
Form A
Schedule I of the regulations
13
Q
Fee for recognition
A
Rule 4 of the rules ( SCRA RULES 1957)
14
Q
Application for recognition has to be accompanied with ?
A
- MOA
- AOA
- Bye-laws
- Other documents - Rule 5 of the rules , section 3 & 4 of the Act and the regulations
15
Q
Manner of application for grant of recognition ?
A
Form D Schedule II
16
Q
Period of recognition granted to a stock exchange shall be as per ?
A
Rule 6 of the rules
17
Q
Regulatory fee of recognized clearing corporation shall be ?
A
Board may specify
18
Q
interest on delay in paying listing fee and regulatory fee ?
A
15 % per annum for each month of delay
19
Q
Renewal of recognition of stock exchange
A
- Same provisions as grant of recognition
- Rule 7 of the rules
20
Q
Renewal of recognition by clearing corporation ?
A
Same as recognition - Form A Schedule I
3 months prior to date of expiry of recognition
21
Q
Minimum net worth of recognized stovk exchange ?
A
100 crores at all times
22
Q
Minimum net worth of clearing corporation
A
100 crore
23
Q
Every recognized clearing corporation shall maintain capital
A
- On the commencement of operations
- Ongoing Basis
- Including Retained earnings and Reserves
24
Q
Capital has to adequately cover ?
A
- Counterparty credit risk
- Business Risk
- Legal Risk
- Operational Risk
25
Recognized clearing corporation shall hold additional capital to cover costs required for ?
1. Orderly wind down, or
2. Recovery of Operations
26
RSE and RCC shall not distribute profits to its shareholders until?
Networth is achieved
27
Submission of audited networth certificate
1. From Statutory Auditor
2. Yearly basis
28
The onus to ensure that all shareholders are fit and proper persons shall be on?
Recognized Stock Exchange or Recognized Clearing Corporation
29
The onus of fit and proper is not applicable in the case of ?
Person holding less than 2 percent equity shares/ voting rights
30
When should a fit and proper criteria declaration be given ?
15 days from end of financial year
31
Purpose of monitoring mechanism is ?
Ensure compliance with shareholding conditions at all times .
32
RSE and RCC have to ensure that all its _ are fit and proper persons at all times ?
1. Directors
2. KMP
33
Fit and Proper person means ?
General Reputation , Fairness and Integrity including but not limited to:
1. Financial Integrity
2. Good reputation and Character
3. Honesty
34
RSE and RCC shall disclose to the Board their shareholding pattern
Quarterly- 15 days from the end of each quarter.
1. 10 largest shareholders- Number and percentage of shares held by them
2. Shareholders falling under regulation 17 and 18 who have acquired shares in that quarter.
35
Representative of issuer of debt securities on the governing board of recognized LPCC may be appointed
1. Rotational basis
2. Deemed to be a Nominee Director
36
The representative of the issuer of debt securities shall be ?
1. One of the top three issuers which are PSU
2. Based on Issue Size in the previous FY
37
For the first five years from date of grant of recognition by Board to LPCC
1. No distribution of dividend to Board
2. All profits will be transferred to fund under Regulation 37
38
LPCC shall not carry on any activity whether involving deploying of funds or otherwise
Without prior approval of Board
39
Prior approval not required in case of ?
1. treasury investments
2. as per investment policy
3. approved by governing board of LPCC
40
Dispute Resolution Mechanism of LPCC
1. For disputes arising out of transactions cleared and settled by it
41
Who will lay down manner in which LPCC shall establish a dispute resolution mechanism ?
Board in consultation with RBI
42
LPCC has to ensure compliance with the provisions of
1. Securities Contracts (Regulation) ( Stock Exchange and Clearing Corporations) Regulations , 2018
2. Directions issued by RBI
43
In case of RSE and RCC, the managing director shall be included in the category of?
Non -Independent Director
44
In case of LPCC, Managing Director will ?
NOT BE INCLUDED in the category of NID
45
An employee of RSE and RCC may be appointed to the governing Board
1. In addition to managing director
2. Deemed to be non-independent director
46
Not a deemed trading member or clearing member ?
Independent Directors of Associates of PFI/ Bank in public sector who are clearing member/trading member
47
Governing Board of RSE/RCC shall comprise of Directors
1. Finance and Accountancy
2. Capital markets
3. Legal and Regulatory Practice
4. management and administration
5. Technology
6. Risk Management
48
PID shall keep its governing board apprised of any conflict of interest which many arise because of him providing services to?
1.Any Company
2. Trading Member
3. Clearing Member
4. Associates /Agent
49
Term of PID
3 years extendable by another term of 3 years
50
Term of MD
5 years for a maximum period of 10 years, subject to age 65
51
Removal of MD
1. By Board Suo Motu- interest of securities market
2. Governing Body of RSE and RCC with prior approval of Board
52
Nomination and Remuneration Committee of Board
1. Majority of PID
2. Chaired by PID
53
Compensation policy of made by NRC
Part I, Schedule II
54
tenure of KMP (Other than a director) of RSE/RCC shall be fixed by
NRC- which will be for a fixed period
55
Tenure means
Period of posting in a regulatory department which shall be for a fixed period.
56
Statutory Committees of RSE/RCC
1. Functional Committee
2. Over sight Committee
3. Investment Committee
57
Every RSE/RCC shall have a ?
Grievance Redressal Panel
58
Compliance Officer shall report to the Board
1. Immediately and Independently
2. Quarterly Basis
59
Chief Risk Officer to report to Board
Half yearly Basis
60
Penalties Levied by RSE/RCC shall be credited to ?
1. IPF
2. Fund under 37-SGF
61
Compliance to Disclosure Requirements and Corporate Governance Norms
Half yearly Basis
62
An employee of a recognized stock exchange or recognized clearing corporation shall not simultaneously be an employee of ?
Any other company where the recognized stock exchange or recognized clearing has invested.
63
Who will not receive any 1. Compensation or 2. Financial Benefit from companies where recognized stock exchange or recognized clearing corporation has invested.
D E CM
Director, Employee, Committee Member
64
RCC shall lay down a policy framework for ensuring that there is no discrimination in settlement of trades executed on?
1. Shareholder Stock Exchanges and
2. Non Shareholder Stock Exchanges
65
Every RSE and RCC shall ensure EUTF access to all persons without bias towards?
Associate and Related Entities (AR)
65
Who will lay down framework for sharing and monitoring of data ?
1. RSE
2.RCC
3. Company where RSE and RCC has invested
66
Which books of accounts and documents have to be maintained by recognized stock exchange for 8 years?
1. Minutes books of meetings of -
A. MEMBERS
B. GOVERNING BODY
C. STANDING COMMITTEE of GOVERNING BODY
D. REGISTER OF MEMBERS with full names and addresses
E. REGISTER OF AUTHORIZED CLERKS
F. REGISTER OF REMISIERS OF AUTHORIZED ASSISTANTS
G. RECORD OF SECURITY DEPOSITS
H. MARGIN DEPOSIT BOOKS
I. LEDGERS
J. JOURNALS
K. CASH BOOK
L. BANK PASS BOOK
67
RSE and RCC shall furnish its annual financial statements and returns to Board as per ?
Rule 17 and 17 A of the rules
68
RSE and RCC shall make bye laws with prior approval of Board for ?
1. Regulation of Contracts
2. Clearing and Settlement
69
Which documents cannot be amended except with prior permission of the Board ?
1. MOA
2. AOA
3. Other constitution document so far they relate to matter specified in Section 3 of the SCRA Act or Regulations
4. Bye-laws of RSE and RCC
70
The Bye-laws and amendments to Articles, Rules, Bye-laws shall be in the manner specified in ?
PART E Schedule II ..... BYEEEEEEEEEEEEE
71
The Payment and Settlement in respect of a transaction in a RSE and RCC shall be determined in accordance with the _ procedure?
1. Netting
2. Gross Procedure
72
Payment and Settlement in respect of a transaction shall be ?
Final, Irrevocable and Binding ... FIB
73
Settlement is final and irrevocable as soon as ?
Money, Securities, other transactions payable IS DETERMINED- whether or not actually paid.
74
Every RCC providing clearing and settlement services for commodity derivatives shall ensure ?
Guarantee for the settlement of Trades INCLUDING Good Delivery
75
Good Delivery means ?
1. Delivery in proper form
2. To transfer title
3. Is of the quality and quantity as per contract specifications of concerned exchange
76
RCC has the right to recover dues from its clearing members after the discharge of its clearing and settlement functions from?
1. Collaterals,
2. Deposits
3. Assets
of clearing members .
77
Every clearing corporation shall devise and maintain a framework for ORDERLY WIND DOWN of its?
Critical operations and services covering both voluntary and involuntary scenarios.
78
Framework for Orderly Wind -Down shall ensure ?
1. Timely and orderly settlement , cessation, transfer of position
2. Transfer of Collaterals, Deposit, Margin, Asset of members to another clearing corporation
3. Related matter
79
A recognized stock exchange can apply for listing of its securities on any other stock exchange other than ?
1. Itself
2. Associated Stock Exchange
80
Conditions for a Recognized Stock Exchange to list its own securities are ?
1. Compliance with the provisions of Ownership and Governance
2. Three Years of continuous trading immediately preceding date of application of listing
3. Approval of Board
81
A recognized stock exchange shall not list ?
Any securities of its associates
82
The securities of a recognized clearing corporation shall not be listed on any ?
Stock Exchange
83
Board may call for any information, document , records from ?
1. Recognized stock exchange
2. Recognized Clearing Corporation
3. Their Governing Board
4. Any Shareholder
84
Board may undertake inspection , inquiries, audit of?
1. Any recognized stock exchange
2. Recognized clearing corporation
3. Any Associate
4. Any Shareholder
5. Associate/Agent of Shareholder
85
Under Stock Exchange Regulations, Board has the power to issue directions like ?
1. Directing a Person holding equity shares or rights over equity shares to divest his holding
2. Direct transfer of proceeds or securities to the IPF or SGF
3. Debarring any stock exchange or clearing corporation , shareholder, associate of shareholder , transferee of shares from accessing securities market or dealing in securities
86
Under Stock Exchange Regulations, the board can also take action against recognized stock exchange, RCC, director, committee member, KMP, employee like?
1. Debarring from introducing new products and services
2. Restricting its existing activities , products and services
3. Imposing Monetary Penalty
4. Restricting any person from attending meetings or participating in functioning of RSE/RCC
87
Before taking any action, Board shall have due regard to?
1. Mala fide intent
2. Omission/ Commission
3. Negligence
4. Repeated instances of genuine decision making that went wrong
88
Networth of clearing corporation means ?
Aggregate value of its liquid assets
89
Networth of stock exchange means ?
Aggregate value of Paid up equity share capital plus free reserves excluding:
1. Statutory funds
2. Benefit Funds
3. Reserves created out of revaluation
90
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