SEBI Defers Phase III of Nomination Circular Beyond Dec 15, 2025

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  • Last Updated on 15 December, 2025

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SEBI Nomination Circular Phase III

Circular No. HO/42/36/12(4)2025-OIAE-IAD3, Dated: 11.12.2025

1. Regulatory Update

SEBI has deferred the implementation of Phase III of the Nomination Circular dated January 10, 2025, which had earlier been rescheduled to December 15, 2025. In view of operational challenges faced by market intermediaries and representations from stakeholders, SEBI has now postponed Phase III to a later date, which will be notified separately.

The circular comes into force immediately, but only for the purpose of deferring Phase III.

2. Key Clarifications

  • Phase III implementation is deferred – The revised deadline of December 15, 2025 will no longer apply. A fresh implementation date will be announced separately.
  • All other provisions remain unchanged – Phases I and II of the Nomination Circular, along with all other obligations, continue to apply as notified.
  • Immediate effect – The deferral takes effect immediately upon issuance of the circular.

3. Regulatory Context

The Nomination Circular aims to strengthen investor protection by mandating nomination or opting out across securities market accounts, including demat accounts, mutual fund folios, and other investment holdings. Phase III was expected to address residual and legacy cases requiring enhanced system-level enforcement.

4. Regulatory Intent

The deferral reflects SEBI’s intent to:

  • Allow intermediaries additional time to address system, process, and operational readiness
  • Avoid disruption to investors due to premature enforcement
  • Ensure smoother, uniform implementation across market infrastructure institutions and intermediaries

5. Implications for Market Intermediaries

Intermediaries should:

  • Continue compliance with Phases I and II of the Nomination framework
  • Pause implementation efforts specifically linked to Phase III
  • Maintain readiness to implement Phase III once a revised timeline is notified
  • Update internal compliance calendars and client communication accordingly

6. Implications for Investors

  • No immediate change in nomination requirements beyond what is already applicable
  • Existing nomination or opt-out statuses remain valid
  • Further actions, if any, will be required only after SEBI notifies the revised Phase III date
Click Here To Read The Full Circular

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied