This circular is being issued in exercise of the
powers conferred by Section 11 (1) of Securities and Exchange Board
of India Act, 1992, read with Section 10 of the Securities Contracts
(Regulation) Act, 1956, to protect the interest of investors in
securities and to promote the development of, and to regulate, the
securities market.
The Bye-Laws of the Stock Exchanges provide for
Arbitration Mechanism for redressal of disputes between members as
well as between a member and a non-member. The documents vis-à-vis
the process of arbitration are preserved with the stock exchanges
for the purpose of record.
In this connection, SEBI has decided to frame a
uniform policy applicable to all stock exchanges regarding the
maintenance / disposal of arbitration records. Accordingly, it has
been decided that :
1.
The
original arbitration award with acknowledgements shall be preserved
permanently.
2.
Other
records pertaining to arbitration shall be preserved for 5 years
from the date of award, in case the appeal for setting aside the
award is not filed till such time.
3.
In case,
an appeal is filed, the records, shall be preserved for five years
from the date of final disposal by the Court.
4.
The
destruction of records shall be subject to the previous order, in
writing of the Executive Director of the Exchange.
5.
The
Exchange shall maintain a register wherein the brief particulars of
the records destroyed alongwith the certification regarding the date
and mode of destruction.
The exchanges are directed to make necessary
amendments to the bye-laws, rules and regulations in order to
incorporate specific provisions regarding the maintenance / disposal
of arbitration records in this regard.
The exchanges are directed to bring the
provisions of this circular to the notice of the member
brokers/clearing members of the exchange and also to disseminate the
same on the website for easy access to the investors.
The exchanges are also directed to communicate to
SEBI, the status of the implementation of the provisions of this
circular in Section II, item no. 13 of the Monthly Development
Report for the month of April 2003.
