i. Whenever a member of any segment is declared defaulter, the concerned Stock Exchange/ Clearing Corporation shall immediately declare it a defaulter in all its segments. It shall also immediately inform all other Stock Exchanges/Clearing Corporations the details of the defaulter member such as name of the member, the names of the proprietors/ partners/promoters/ dominant shareholders, as applicable.
ii. Immediately on receipt of the information about default of a member, the other Stock Exchange / Clearing Corporation shall declare the said member defaulter on all its segments.
iii. The Stock Exchanges / Clearing Corporations shall take appropriate action against the associates of defaulter member. For this purpose, the term ‘associate’ shall include a person:a. who, directly or indirectly, by itself, or in combination with other persons, exercises control overExplanation: The expression “control" shall have the same meaning as defined under clause (e) of Regulation 2 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.
the member, whether individual, body corporate or firm or holds substantial share of not less than 15% in the capital of such entities; or
b. in respect of whom the member, individual or body corporate or firm, directly or indirectly, by itself or in combination with other persons, exercises control; or
c. whose director or partner is also a director or partner of the member, body corporate or the firm, as the case may be.
i. To make necessary amendments to the relevant bye-laws, rules and regulations.
ii. Bring the provisions of this circular to the notice of the stock brokers of the Exchange and also to disseminate the same on their website.
iii. Communicate to SEBI, the status of the implementation of the provisions of this circular.