NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Dematerialisation
Mr. Raghav Iyer submits a Dematerialisation Request Form (DRF) along with physical share certificates to his Depository Participant. Before forwarding the request to the issuer or its registrar, what must the DP do with the certificates?
The DP must deface the share certificates by marking them 'Surrendered for Dematerialisation' and record their details on the DRF before sending them to the issuer's registrar. This prevents misuse of the physical certificates once the dematerialisation process has begun.
- ACancel the certificates by stamping them 'Surrendered for Dematerialisation' and record the certificate details on the DRFCorrect
- BReturn the certificates to the investor after taking a photocopy
- CTransfer the certificates to the depository for safekeeping
- DSend the certificates directly to the stock exchange for verification
Explanation
On receiving a demat request, the DP verifies the documents and defaces the certificates by marking them 'Surrendered for Dematerialisation', and records their details on the DRF. The defaced certificates and DRF are then forwarded to the registrar. The depository and exchange are not the recipients of the physical certificates.
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