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CS Executive · Capital Market and Securities Laws · Secondary Market in India

Under Section 4(2) of the SCRA, which matter may be covered by conditions the Central Government prescribes for recognition?

The conditions may relate to Central Government representation on the exchange by up to three nominated persons. Section 4(2)(iii) lists this alongside membership qualifications, manner of contracts between members and audit of members' accounts by chartered accountants where required.

  1. ARepresentation of the Central Government on the exchange by not more than three nominated personsCorrect
  2. BFixing the daily closing price of every listed security
  3. CMandatory merger with another exchange within a year
  4. DNomination of the exchange's chief executive by the Reserve Bank

Explanation

Section 4(2)(iii) allows conditions on the representation of the Central Government on each exchange by such number of persons, not exceeding three, as it may nominate. The other options are not matters listed in that sub-section.

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