Eligibility Criteria

The following are eligible to apply for membership subject to the regulatory norms and provisions of SEBI and as provided in the Rules, Regulations, Byelaws and Circulars of the Exchange -

 

1. Individuals;

 
2. Partnership Firms registered under the Indian Partnership Act, 1932;

 
3. Corporations, Companies or Institutions or subsidiaries of such Corporations, Companies or Institutions set up for providing financial services;

 
4. Banks for Currency Derivative Segments
    
5. Such other person as may be permitted under the Securities Contracts (Regulation) Rules 1957.
   

• Other Eligibility Criteria
   
• Who cannot become a member
   

1. Individuals (Sole Proprietor)


 

Criteria
Age	Minimum age : 21 years
Status	Indian Citizen
Education	At least HSC or equivalent qualification
Experience	Applicant should have an experience for not less than two years as a partner with, or an authorised assistant or authorised clerk or remisier or apprentice to, a member.




Top





2. Partnership Firms




Where the applicant is a partnership firm, the applicant shall identify a Dominant Promoter Group as per the norms of the Exchange at the time of making the application. Any change in the shareholding of the partnership firm including that of the said Dominant Promoter Group or their sharing interest shall be effected only with the prior permission of NSEIL/SEBI.
 

Criteria
Age	Minimum age of partner(s) : 21 years
Status	Registered Partnership firm under Indian Partnership Act, 1932
Education	Partners should be at least HSC or equivalent qualification
Designated Partners	Identify at least two partners as designated partners who would be taking care of the day to day management of the partnership firm
Designated Partners Experience	Should have a minimum of 2 years experience in an activity related to dealing in securities or as portfolio manager or as investment consultant or as a merchant banker or in financial services or treasury, broker, sub broker, authorised agent or authorised clerk or authorised representative or remisier or apprentice to a member of a recognised stock exchange, dealer, jobber, market maker, or in any other manner in dealing in securities or clearing and settlement thereof.
Dominant Promoter Norms	Identify partner’s sharing interest as per Exchange DPG norms


Top





3. Corporations, Companies or Institutions




A Company as defined in the Companies Act, 1956 (1 of 1956), shall be eligible to be admitted as a member of a Stock Exchange provided:



1. such company is formed in compliance with the provisions of Section 12 of the said Act;




2. it undertakes to comply with such other financial requirements and norms as may be specified by the Securities and Exchange Board of India for the registration of such company under sub-section (1) of section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992);




3. the directors of such company are not disqualified for being members of a stock exchange under clause (1) of rule 8 [except sub-clauses (b) and (f) thereof] or clause (3) of rule 8 [except sub-clauses (a) and (f) thereof] of the Securities Contracts (Regulation) Rules, 1957 and the directors of the company had not held the offices of the directors in any company which had been a member of the stock exchange and had been declared defaulter or expelled by the stock exchange




 

CRITERIA
Age	Minimum age of director(s) : 21 years
Status	Corporate registered under The Companies Act, 1956 (Indian)
Minimum Paid up Equity Capital	Rs.30 lakhs
Designated Directors	Identification of at least two directors as designated directors who would be managing the day to day trading operations
Education	Each of the Designated Directors should be at least HSC or equivalent qualification
Designated Directors Experience	Should have a minimum of 2 years experience in an activity related to dealing in securities or as portfolio manager or as investment consultant or as a merchant banker or in financial services or treasury, broker, sub broker, authorised agent or authorised clerk or authorised representative or remisier or apprentice to a member of a recognised stock exchange, dealer, jobber, market maker, or in any other manner in dealing in securities or clearing and settlement thereof.
Dominant Promoter Norms	Identify dominant group as per Exchange DPG norms




4. Professional Clearing Member (PCM)




The following persons are eligible to become PCMs of NSCCL for Futures & Options and/or Capital Market Segment provided they fulfill the prescribed criteria:

1. SEBI Registered Custodians; or
2. Banks recognised by NSEIL/NSCCL for issuance of bank guarantees



Top



5. Banks




Further to Circular No: 648 with Download No: NSE/MEMB/11148 dated August 19, 2008, the eligibility membership criteria for banks in the Currency Derivatives segment is as follows:

Banks authorized by the Reserve Bank of India under section 10 of the Foreign Exchange Management Act, 1999 as ‘AD Category - I bank’ are permitted to become trading and clearing members of the currency futures market of the recognized stock exchanges, on their own account and on behalf of their clients, subject to fulfilling the following minimum prudential requirements:


Minimum net worth of Rs. 500 crores.

Minimum CRAR of 10 per cent.

Net NPA should not exceed 3 per cent.

Made net profit for last 3 years.

The AD Category - I banks which fulfill the prudential requirements are required to lay down detailed guidelines with the approval of their Boards for trading and clearing of currency futures contracts and management of risks.

AD Category - I banks which do not meet the above minimum prudential requirements and AD Category - I banks which are Urban Co-operative banks or State Co-operative banks can participate in the currency futures market only as clients, subject to approval therefore from the respective regulatory Departments of the Reserve Bank.

The requirement of approved users of being certified as per the certification as applicable in the F&O segment is waived off for banks for a period of one year from the date of the issuance of SEBI circular SEBI/DNPD/Cir- 38 /2008 dated August 06, 2008.
 

Top




6. Other applicable eligibility criteria




1. At any point of time the applicant has to ensure that either the proprietor/one designated director/partner or the Compliance Officer of the applicant entity should be successfully certified either in Securities Market (Basic) Module or Compliance Officers (Brokers) Module or the relevant module pertaining to the segments wherein membership of the Exchange has been sought.i.e.
   
   

   1. Capital Market (Dealers) Module
      
   2. Derivatives Market (Dealers) Module
   3. National Institute of Securities Markets (NISM) Series I – Currency
      Derivatives Certification Examination
      

   The above norm would be a continued admittance norm for membership of the Exchange.





2. An applicant must be in a position to pay the membership and other fees, deposits etc, as applicable at the time of admission within three months of intimation to him of admission as a Trading Member or as per the time schedule specified by the Exchange.





3. The Exchange may specify such standards for investor service and infrastructure with regard to any category of applicants as it may deem necessary, from time to time.





7. Who cannot become a member ?




Further to the capital and network requirements, No entity shall be admitted as a member/partner or director of the member if



1. It has been adjudged bankrupt or a receiver order in bankruptcy has been made against him or he has been proved to be insolvent even though he has obtained his final discharge;




2. it has compounded with his creditors for less than full discharge of debts;




3. it has been convicted of an offence involving a fraud or dishonesty;




4. it is engaged as a principal or employee in any business other than that of Securities, except as a broker or agent not involving any personal financial liability or for providing merchant banking, underwriting or corporate or investment advisory services, unless he undertakes to severe its connections with such business on admission, if admitted;




5. it has been at any time expelled or declared a defaulter by any other Stock Exchange or he has been debarred from trading in securities by an Regulatory Authorities like SEBI, RBI etc;




6. it incurs such disqualification under the provisions of the Securities Contract (Regulations) Act, 1956 or Rules made there-under so as to disentitle such persons from seeking membership of a stock exchange;




7. it incurs such disqualification consequent to which NSE determines it to be not in public interest to admit him as a member on the Exchange, provided that in case of registered firms, body corporates and companies, the condition from (will apply to, all partners in case of partnership firms, all directors in case of companies; NSE may from time to time modify / expand the scope of activities that could be considered as relevant experience for the above purpose.