The government has changed the rules for stock and commodity market brokers. Its purpose is to make the compliance easier for them. For this, the Department of Economic Affairs (DEA) under the Finance Ministry has changed the Securities Contracts (Regulation) Rules, 1957. The government has clarified that any investment made by a broker will not be considered as a business activity, unless this investment includes clients funds or security or it is not a financial liability for the broker.
Stock and commodity brokers will be easy to work
Experts have welcomed this change. He says that the situation has become clear by changes in rules. This will make it easier for brokers to work. Ease of doing business will increase for them. In fact, SCRR In Rule 8, qualification (qualification) is fixed to be selected or a member of a person’s stock exchange or to remain a member. Dea introduced a discussion paper in September 2024. It was told about the need for possible changes in SCRR rules.
Securities contracts (regulation) deficiency is overcome
The DEA said in the discussion paper that Rule 8 mentions ‘a business’. However, nothing has been said clearly about this and it is not clearly defined. Therefore, different meanings can be extracted. Now this deficiency has been removed after amendment in the rules. For this, a new provision has been included in Rule 8 in Securities Contracts (Regulation) Rules, 1957 (SCRR, 1957).
Changes in rules will increase transparency in the functioning of brokers
The government has made this change after receiving feedback of people associated with the case on the desuction paper. The government’s effort is to make the rules related to the stock exchange easier and clear. The government believes that this will increase the Ease of Doing Business in the financial sector. This will increase the interest of market intermediates in the development of capital markets in India. This will bring transparency in functioning.
Government issued a notification for change in rules
Experts say that by changing the rules, brokers will now be able to use their funds for many types of work. These include purchases of assets. The broking industry was told about its problems regarding the interpreting of Rule 8. Gazette notification has been issued by the government for this amendment.
