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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Transmission and Nomination

In a demat account held by a single holder who has registered a nominee, the holder dies. Which statement best describes the position of the nominee under depository procedures?

The nominee becomes entitled to the securities and can get them transmitted to his own demat account by submitting the transmission request, death certificate and KYC documents. He cannot use the deceased holder's instruction slips, and a succession certificate is not normally required when a valid nomination exists.

  1. AThe nominee becomes the beneficial owner of the securities and may have them transmitted to his name on submitting the required documentsCorrect
  2. BThe nominee can sell the securities immediately using the deceased holder's delivery instruction slip
  3. CThe nominee must first obtain a succession certificate in every case
  4. DThe nominee loses the right if the legal heirs object

Explanation

On death of a sole holder, the nominee is entitled to have the securities transmitted to his own account by submitting a transmission request with the death certificate and identity and KYC documents. Using the deceased's instruction slip is not permitted, and a succession certificate is not needed where a valid nomination exists.

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