SEBI widens the scope of KMP’s definition under Securities Contracts Regulations
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- Last Updated on 3 March, 2023
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Notification No. SEBI/LAD-NRO/GN/2023/124., Dated 28.02.2023
The SEBI has notified SEBI Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2023. As per the amended norms, the scope of KMPs definition under regulation 2(1)(j) has been enhanced. The definition of the KMP shall now include:
(a) any person appointed as the managing director or executive director; or
(b) a person serving as the head of a department or vertical and directly reporting to the managing director or to the directors on the governing board of the recognised stock exchange or recognised clearing corporation; or
(c) a person serving as the head of a core function as specified under Part–C of Schedule–II of these regulations.; or
(d) a person who stands higher in hierarchy to the head of any department(s) handling core function(s) in the recognised stock exchange or recognized clearing corporation; or
(e) reporting officials of key management personnel; or
(f) any person defined as “key managerial personnel” under the Companies Act, 2013; or
(g) any other person who is a key decision making authority at the level of the recognised stock exchange or recognised clearing corporation or its direct or indirect material subsidiaries, as identified by the managing director or its Nomination and Remuneration Committee:
Further, the SEBI has introduced a new definition of a non-independent director. The term “non-independent director” means a director elected or nominated by the shareholders who are neither trading members nor clearing members, as the case may be, or their associates and agents.
The Board may appoint one or more persons not exceeding three in number, as director(s) on the governing board of any recognised stock exchange or recognised clearing corporation and such director(s) shall enjoy the same status and power as the other directors of the governing board.
Also, the SEBI has prescribed a code of conduct for recognized stock exchanges and clearing corporations.
Click Here To Read The Full Notification
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