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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Investor Grievances and Arbitration

An investor is dissatisfied with the resolution of a complaint by a broker and wants to approach the stock exchange. Which mechanism is available at the exchange to resolve such disputes between the client and a trading member through a neutral process before escalating to arbitration?

The exchange's investor service centre takes up the complaint and offers conciliation or mediation with a neutral person to settle the dispute. If this fails, the investor can proceed to the exchange arbitration mechanism. Courts, the Registrar of Companies and tax tribunals are not part of this process.

  1. AInvestor Service Centre complaint resolution followed by conciliation or mediationCorrect
  2. BDirect appeal to the Supreme Court
  3. CReference to the Registrar of Companies
  4. DComplaint to the Income Tax Appellate Tribunal

Explanation

Exchanges handle investor complaints through their investor service centres and offer a conciliation or mediation step, using a neutral person, before the arbitration stage. Courts, the RoC and the ITAT are not part of the exchange's dispute resolution process for broker-client disputes.

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