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NISM Certifications · NISM-Series-VI: Depository Operations · Depository and its Business Partners

A company wishes to have its shares admitted to a depository so that investors can hold them in dematerialised form. With which entity must it execute a tripartite arrangement alongside the depository?

The issuer signs an agreement with the depository, and where the issuer uses an RTA, a tripartite agreement among issuer, depository and RTA is executed. This lets the RTA handle demat requests and corporate action data electronically with the depository.

  1. AIts statutory auditor
  2. BIts Registrar and Transfer AgentCorrect
  3. CThe Clearing Member of the stock exchange
  4. DThe Self Regulatory Organisation of brokers

Explanation

An issuer admitting securities to a depository enters an agreement with the depository, and where it uses an RTA, a tripartite agreement among the issuer, the RTA and the depository is made. This lets the RTA process demat and remat requests and corporate action data electronically. The auditor and clearing member play no such role.

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