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

In the context of a demat account, what does 'transmission' of securities mean?

Transmission means transfer of securities to surviving holders or legal heirs when a beneficial owner dies. It happens by operation of law rather than by a voluntary delivery instruction from a living holder, which is why it differs from an ordinary off-market transfer.

  1. ATransfer of securities from one account to another through an off-market instruction by a living holder
  2. BTransfer of securities to the surviving holder(s) or legal heirs on the death of a beneficial ownerCorrect
  3. CMovement of securities from a client account to the clearing member pool account on a trade
  4. DConversion of physical share certificates into electronic form

Explanation

Transmission refers to the transfer of holdings by operation of law, typically on the death of a holder, to the surviving joint holder(s) or the nominee/legal heirs. Off-market transfers by living holders are transfers, not transmission. Pay-in to the clearing member and dematerialisation are different processes.

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