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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to Securities Broking Operations

A broker's client, Mr. Iyer, places an order through the broker's trading system. Under exchange and SEBI norms, which practice regarding the Unique Client Code (UCC) is correct?

The broker must enter the client's UCC with each client order, and the UCC must be registered with the exchange, mapped to the client's PAN. There is no exemption for long-standing clients or small orders, and the UCC is not assigned by a depository.

  1. AThe broker may enter orders without a UCC if the client is a long-standing customer
  2. BThe broker must enter the client's UCC for every client order, and orders cannot be placed for a client whose UCC is not registered with the exchangeCorrect
  3. CThe UCC is needed only for orders above Rs 10 lakh
  4. DThe UCC is assigned by the depository for each trade

Explanation

Each client must be assigned a unique client code, which is mapped with the client's PAN and uploaded to the exchange. Orders must carry the correct UCC. The requirement is not based on order size or client tenure, and the depository does not assign UCCs.

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