NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Transmission and Nomination
In depository operations, what is the term for the process by which securities held in a deceased sole holder's demat account are moved into the name of the legal heir or nominee?
The process is called transmission. It refers to transfer of securities to a legal heir or nominee by operation of law, for example when the sole holder of a demat account dies. It is different from transposition, which merely reorders names among joint holders.
- ATransmissionCorrect
- BTransposition
- CRematerialisation
- DFreezing
Explanation
Transmission is the transfer of securities to the legal heir or nominee by operation of law, such as on death of the holder. Transposition only changes the order of names in joint accounts. Rematerialisation converts demat holdings into physical form. Freezing restricts debits or credits.
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