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NISM Certifications · NISM-Series-VI: Depository Operations · Introduction to the Indian Capital Market

Ms. Latha Iyer asks about the regulatory structure of the Indian securities market. Which of the following correctly reflects the role of SEBI in relation to depositories?

SEBI registers and regulates depositories in India. They operate under the Depositories Act, 1996 and the SEBI regulations framed under it, which cover depositories and their participants. Neither RBI, stock exchanges nor the corporate affairs ministry alone is the licensing regulator for depositories.

  1. ASEBI registers and regulates depositories under the Depositories Act, 1996 and SEBI regulations framed under itCorrect
  2. BDepositories are regulated only by the RBI and need no SEBI registration
  3. CDepositories are regulated by stock exchanges, which grant them licences
  4. DDepositories are regulated by the Ministry of Corporate Affairs alone

Explanation

Depositories must obtain a certificate of registration from SEBI and are governed by the Depositories Act, 1996 and the SEBI (Depositories and Participants) Regulations. RBI, exchanges or MCA alone do not license them.

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