All Recognized Stock Exchanges (including Commodity Derivatives)

master_circulars · 1992 · State unknown

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Parent: THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (7c4c1f5343adab106c3a94cafc08a5ecf5957ae7)

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To, All Recognized Stock Exchanges (including Commodity Derivatives) All Clearing Corporations All Depositories All Stock Brokers All Depository Participants All SEBI Registered Intermediaries / All SEBI Regulated Entities All Listed Companies Sir / Madam, Subject: Master Circular for Online Resolution of Disputes in the Indian Securities Market After extensive public consultations and in furtherance of the interests of investors and consequent to the gazette notification (dated July 3, 2023) of the SEBI (Alternative Dispute Resolution Mechanism) (Amendment) Regulations, 2023 the existing dispute resolution mechanism in the Indian securities market is being streamlined under the aegis of Stock Exchanges and Depositories (collectively referred to as Market Infrastructure Institutions (MIIs)), 1 by expanding their scope and by establishing a common Online Dispute Resolution Portal ("ODR Portal") which harnesses online conciliation and online arbitration for resolution of disputes arising in the Indian Securities Market. Investors and Listed Companies/Specified Intermediaries/Regulated entities under the ambit of ODR Disputes between Investors/Clients (including institutional/corporate 1 presently excluding Clearing Corporations and its constituents MASTER CIRCULAR FOR ONLINE DISPUTE RESOLUTION (Updated as on December 28, 2023) SEBI/HO/OIAE/OIAE_IAD-3/P/CIR/2023/195 July 31 , 2023 (Updated as on August 04, 2023) (Updated as on December 20, 2023) clients) and listed companies (including their registrar and share transfer agents) or any of the specified intermediaries / regulated entities in securities market (as specified in Schedule A) arising out of latter's activities in the securities market, will be resolved in accordance with this circular and by harnessing online con

Rule TOC

1 · presently excluding Clearing Corporations and its constituents

2 · Service related complaints shall include non-receipt/ delay of account statement, non-receipt/ delay of bills, closure of account/branch, technological issues, shifting/closure of branch without intimation, improper service by staff, freezing of account, alleged debit in trading account, contact person not available, demat account transferred without permission etc.

3 · For example, non-disclosure agreements signed by specified intermediaries or regulated entities with their institutional or corporate clients for receiving confidential corporate or other information by itself would not be related to the Indian securities market. Separately, regulated entities such as Credit Rating Agencies or Debenture Trustees also undertake non-securities market related work which would be outside the scope of the clause.

4 · As and when the same is made operational, in order to avoid conflict of interest, in case of a complaint/dispute involving a MII or its holding or subsidiary or associate company, the same will not be allocated to that MII and the ODR Institution empaneled by such MII or to the direct competitor of such MII and the ODR Institution empaneled by such MII: such dispute will be directed to another MII and the ODR Institution empaneled by it. For instance, any dispute against NSE shall be allocated to CDSL and in case of a dispute in relation to BSE, the same be allocated to NSDL and vice versa.

5 · URL -https://smartodr.in/login

6 · For instances where the dispute pertains to an intermediary linked to more than one Stock Exchange/ Depository (or a company listed on more than Stock Exchange) then the Stock Exchange/ Depository with which the complaint was escalated becomes the relevant Stock Exchange/ Depository, otherwise it shall be subject to round robin

7 · If parties to the dispute do not provide any representation in the arbitral proceedings, the arbitrator may pass an ex-parte order after giving a notice of 7 calendar days to the concerned non -cooperative party(ies).

1A · . Banker to an Issue and SelffCertified Syndicate Banks 8

2A · Commodities Clearing Corporations 9

5A · . Merchant Bankers

9A · Research Analyst

8 · including for any claims / complaints / disputes pertaining to compensation to investors for grievance emanating from application to Public Issues using UPI payment with ASBA.

9 · Including for any claims / complaints / disputes raised by investors/clients on account of Warehouse Service Providers / Vault Service Providers

10 · For any claims/complaints/disputes arising on account of compensation to investors for grievances emanating from application for public issues .

11 · Including for any claims/complaints/disputes arising on account of Mutual Fund Distributors of the Mutual Fund AMCs

12 · Including for any claims/complaints/disputes arising on account of Authorised Persons of the Trading Members

1A · . Commodities Clearing Corporations 13

5A · ESG Ratings Providers and their clients

13 · Including for any claims / complaints / disputes arising on account of Warehouse Service Providers / Vault Service Providers and depositors / ginners.

10 · MII shall ensure that each ODR institution shall abide by the following norms for furthering transparency and evolving precedents:

11 · MIIs shall inspect and/or audit the ODR Institution directly or through such person or firm that it may appoint, for, inter alia, verifying the adherence to these norms and applicable SEBI regulations, circulars and advisories.

12 · MIIs shall ensure that the ODR Institutions abide by the SEBI regulations, circulars and advisories on online conciliation and online arbitration as applicable. MIIs shall ensure empaneled ODR institutions shall furnish an irrevocable, unconditional undertaking that it shall abide by the norms of empanelment specified, and SEBI regulations, circulars and advisories or norms as may be notified by SEBI and the respective MII from time to time. The ODR institutions shall also acknowledge through such undertaking that the grievance redressal and dispute resolution mechanisms have been set up by the Board as a part of its institutional framework to provide robust dispute resolution processes for the investors and Market Participants.

13 · Any complaints/grievances against the ODR Institutions with respect to their services pursuant to this circular shall be resolved in accordance with agreements entered into the MIIs with their ODR Institutions.

14 · MIIs shall ensure that the empaneled ODR Institutions have adequate infrastructure, manpower and resources to assist the former in maintaining compliance with their responsibilities under paragraphs 31 – 40 of this circular.