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| FAQs
- Compliance |
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| Opening
Client Account |
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What are the Circulars of the Exchange regarding Know Your Client Forms? |
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| Following are the circulars regarding Know Your Client Forms: |
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What
are the requirements
related to Know
Your Client
Form? |
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| You
may please refer
to Circular
No. MCX/206/2008
dated June 16,
2008. |
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What
are the valid
documents which
can be collected
as address proof,
identity proof
and proof of
bank account
from clients? |
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Can
electricity
bills/telephone
bills be collected
as an address
proof along
with KYC forms? |
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| Yes,
the electricity
bills/telephone
bills can be
collected as
an address proof
along with KYC
forms but such
bills should
not be more
than three months
old. |
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Are
members required
to collect PAN
details from
their clients,
residing of
the state of
Sikkim, along
with other KYC
requirements? |
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| According
to clarification
provided by
Forward Markets
Commission,
members may
exempt prospective
individual clients,
residing of
the state of
Sikkim from
PAN requirements.
But the members
need to ensure
that a system
of proper verification
exists to verify
that such clients
are residents
of the state
of Sikkim. |
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What
are the requirements
related to Member
Client Agreement? |
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| You
may please refer
to Business
Rule 27 and
Annexure XI
of Business
Rules. |
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What
are the requirements
related to Risk
Disclosure Document? |
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| You
may please refer
to. Circular
No. MCX/206/2008
dated June 16,
2008. |
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| Contract
Notes and Brokerage |
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Which are the Circulars of the Exchange regarding issue of contract notes by members? |
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| Following are the circulars regarding issue of contract notes by members: |
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What
is the format for issuing contract notes? |
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| The contract notes
should be issued as per the format
prescribed in the Circular No.MCX/Legal/363/2008
November 15, 2008. |
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When
are contract notes required to be issued to clients? |
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| Contract Notes
are required to be issued to the clients
for all their transactions within
24 hours of the execution of the trade.
You may please refer to Circular No.
MCX/COMP/195/2008
dated June 06, 2008. |
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What
is the requirement
with respect
to numbering
the contract
notes? |
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| Contract
notes are required
to be serially
numbered beginning
from one, which
is to be reset
only at the
beginning of
the next year.
In case the
member has more
than one office,
Member can set
separate series
numbers with
dealing office
name or code
as a prefix
to the serial
number. You
may please refer
to Circular
No. MCX/012/2006
dated January
10, 2006. |
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Can
a member issue digital contract notes? |
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Are
physical contract notes required to be issued in
addition to digital contract notes? |
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| In addition to
digital contract notes, on request
from client, Member has to provide
physical Contract Notes. Please refer
Circular no. MCX/304/2007
dated September 01, 2007 |
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Is there any requirement of maintaining evidences of dispatch of contract notes to clients? |
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Is
it mandatory to show Brokerage amount separately
on the contract notes? |
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| Yes, the specified
format for contract note requires
brokerage amount to be shown separately.
You may please refer to Business
Rule 28 and Circular No.MCX/Legal/363/2008
November 15 , 2008. |
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What
is the maximum permissible brokerage amount? |
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| The maximum permissible
brokerage rate is 1 % in case of non-delivery
transactions and 2 % (plus expenses)
in case of transactions resulting
into delivery. You may please refer
to the Business
Rule 28. |
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| Books of Accounts |
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What are the references regarding maintenance of books of accounts? |
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| Following are the references regarding maintenance of books of accounts: |
- Bye-law
2.3.11, 4.23,
11.5, 11.6
- Business
Rule 35.
- Circular No.
MCX/COMP/113/2010dated April 05, 2010
- Circular No.
MCX/COMP/399/2009dated September 30, 2009
- Circular No.
MCX/COMP/195/2008
dated June 06,
2008.
- Circular No.
MCX/COMP/183/2008
dated May 27,
2008.
- Circular No.
MCX/COMP/304/2007
dated September
01, 2007.
- Circular No.
MCX/357/2006
dated September
02, 2006.
- Circular No.
MCX/012/2006
dated January
10, 2006.
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What
is the period for
which books of accounts
are required to be
maintained? |
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| Books
of records are required
to be preserved for
a minimum period of
three years except
order log/ trade log
which are required
to be preserved for
a period of minimum
seven years. |
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| Appointment of Sub- Broker |
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What are the requirements related to sub- brokers? |
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What
is the format for issuing confirmation notes from
sub-brokers to its' clients? |
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| The confirmation notes should be issued as per the format prescribed in the Circular No.MCX/56/2004
July 09, 2004. |
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What
is the timeline for issuing confirmation notes by
sub- brokers to their clients? |
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| Confirmation memo/notes
should be issued by a sub broker to
each of its clients within 24 hrs
of receipt of contract notes from
the main member. |
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What
is the requirement with respect to brokerage amount
to be charged by sub- broker? |
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| Brokerage/Commission
if any charged by the sub- broker
should not exceed one and one-half
of one percent of the value mentioned
in the respective sale or purchase
note. However, the total brokerage
including the share of brokerage of
the member and the sub-broker should
not exceed the maximum permissible
limit. |
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Is
it required to provide the Brokerage sharing details
among member & Sub-broker to the client? |
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Can
a sub- broker of a MCX Member be a sub- broker of
any other Member of MCX? |
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Can
a sub-broker of MCX Member be a sub broker of any
other commodity Exchange Member? |
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| Annual Compliance Report |
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What are the references regarding submission of Annual Compliance Report? |
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| Following are the references regarding submission of Annual Compliance Report: |
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What is the procedure for submitting Annual Compliance Report by Members to the Exchange? |
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What
is the last
date of submission
of ACR for Financial
Year 2009-10? |
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Can the Compliance Officer sign the Annual Compliance Report (ACR)? |
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If certain points in ACR are not applicable, what should members do? |
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| Write ‘N.A.’ in the designated area and reason for non-applicability in respective remarks column. |
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| Anti Money Laundering |
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What are the circulars of the Exchange regarding Prevention of Money Laundering Act? |
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What are the requirements regarding appointment of Principal Officer? |
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| Members/intermediaries are required to designate a senior management officer located at head/corporate office as Principal Officer. The name, designation and addresses of the Principal Officer are required to be intimated to the office of the Director - Financial Intelligence Unit (FIU) - India. You may please refer to Circular No. MCX/COMP/488/2009 dated November 27, 2009 for details. |
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Which type of transactions are required to be reported to FIU-IND? |
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| Members/ intermediaries are required to report below mentioned transactions to FIU-IND: |
- Cash Transactions
- Suspicious Transactions
You may please refer to Circular No. MCX/COMP/488/2009 dated November 27, 2009 for details. |
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When Cash transaction Reports are required to be reported to FIU-IND? |
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| The Cash Transaction Reports wherever applicable for each month should be reported to FIU-IND by 15th of succeeding month in the format prescribed in Annexure I of the Circular No. MCX/COMP/488/2009 dated November 27, 2009. Please refer the said circular for details. |
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When Suspicious transaction Reports are required to be reported to FIU-IND? |
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| The suspicious Transaction Reports should be reported within 7 days of arriving at a conclusion that any transaction, whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature in the format prescribed in Annexure II of the Circular No. MCX/COMP/488/2009 dated November 27, 2009. Please refer the said circular for details. |
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| Miscellaneous |
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Are
there any requirements relating to appointment of
Compliance Officer? |
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| Yes, you may please
refer to Circular No. MCX/207/2006
dated May 19, 2006. |
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What
are the documents required to be submitted by a
member on an annual basis? |
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| A member has to
submit the following documents on
an annual basis:
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Annual
Compliance Report: You may please refer to latest Circular No.MCX/COMP/183/2008
dated May 27, 2008.
Annual
Returns: You may please refer to latest Circular No. MCX/COMP/183/2008
dated May 27, 2008. |
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Are members required to obtain prior approval from Exchange before issuing advertisement? |
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| Yes, you may please refer to Circular No. MCX/007/2005 dated January 03, 2005. |
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Are there any Guidelines relating to issue of advertisements by members? |
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| Yes, you may please
refer to Circular No. MCX/003/2006
dated January 03, 2006. |
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Can
multiple client codes be allotted to a single client? |
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Are
there any requirements relating to display of Notice
Board? |
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| Yes, you may please
refer to Circular No. MCX/295/2006
dated July 28, 2006. |
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Is
there any circular relating to list of fines/penalties
for violations/non-compliances observed in inspection
of members? |
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Can
suspended/debarred brokers, sub-brokers and other
entities of Capital Market participate in Commodity
derivative market? |
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| No, you may please
refer to Circular No. MCX/011/2006
dated January 10, 2006. |
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Can a member undertake Portfolio Management Activities? |
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Is there any format for applying for Status Report? |
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Can
a member of MCX become the client of another member
of MCX? |
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At
what places registration certificate issued by the
Exchange is required to be displayed? |
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| Registration certificate
issued by the Exchange is required
to be displayed at the member's head
office and branches/sub-brokers' offices. |
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Is it required for members to undergo system audit for CTCL and internet based trading? |
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When
are members required to make payment of funds to
their clients? |
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| Members are required
to ensure full payment of funds has
been made to all clients within 48
hours of receiving pay out from the
Exchange. |
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When
are members are required to send statement of accounts
for funds to their clients? |
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| Statement of funds
for accounts is required to be sent
to all clients on quarterly basis. |
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Is
a member required to collect margin from clients? |
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| Yes, Members are
required to ensure collection of adequate
margin from clients before entering
any orders on behalf of them. |
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Are there any guidelines with respect to use of MCX logo? |
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Is there any requirement of maintaining evidences of making payment to client on account of the mark to Market gains made by clients? |
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Is there any requirement of maintaining evidences of client placing orders? |
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Are Members allowed to accept cash from their clients? |
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In what form payment can be received / made by members from/to clients? |
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| All payments can be received/made by the members from/to the clients strictly by account payee crossed cheques /demand drafts or by way of direct credit into the bank account through EFT, or any other mode allowed by RBI. You may please refer to Circular No. MCX/Comp/304/2007 dated September 01, 2007 ,
MCX/Comp/250/2009 dated June 09, 2009 and MCX/Comp/401/2009 dated October 01, 2009 |
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What are the circulars of the Exchange regarding Inactive Clients? |
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| Following are the circulars regarding Inactive Clients: |
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For Latest commodity futures prices, SMS “MCX
<space> <Commodity
Name>“ to 58888 |
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