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ROADMAP TO BECOME A Member OF THE BSE DERIVATIVES SEGMENT

Contents

Roadmap to Derivatives

Annexure-1 ( Types of Membership)

Annexure-2 (Networth & Financial Requirements)

Annexure-3 (Networth computation formula)

Annexure-4 ( Trader Workstation & VSAT charges,application form for DTWS)

Annexure-5 (List of Clearing Banks )

Note: For downloading Membership application forms /TM-CM agreement format/Bank Guarantee Format, Rules, Regulations, Bye-laws..log on to http://www.bseindia.com/about/derivati.asp

 

ROADMAP TO BECOME A Member OF THE BSE DERIVATIVES SEGMENT

 

Derivatives Membership application forms available at BSE India Website or with the Relationship Managers (BDM Department)

If any query, feel free to contact Relationship Managers (BDM Department)

Choose the type of Membership you want to apply for
See annexure 1 & annexure 2

The applications forms duly filled along with the required documents should be submitted to the Membership Services & Development -(MSD) (28 th Floor, P.J.Towers)

Application will be placed before the BSE Committee of Executives

BSE Committee of Executives may call you for a personal interview

Applications approved by BSE Committee of Executives will be sent to SEBI for approval and registration

  • After the BSE Committee of Executives approval, the MSD will issue election and admission letter to the Member.

After SEBI 's Approval

After receipt of SEBI registration, applicants account will be debited by Rs. 50,000.00 in case of Clearing Membership

For Commencement of Business in the Derivatives Segment, please contact Relationship Managers (BDM Department)

START TRADING IN
DERIVATIVES

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Annexure-1

TYPES OF MemberSHIP IN THE BSE DERIVATIVES SEGMENT

TRADING
Member
(TM)  		 TRADING-CUM-CLEARING Member (TCM)    PROFESSIONAL CLEARING
Member /
CUSTODIAL CLEARING Member
(PCM) / (CU)  		 LIMITED
TRADING
Member
(LTM)  		 SELF
CLEARING
Member
(SCM)  

Trading Member

  • A Trading Member should be an existing Member of BSE cash segment.
  • A Trading Member has only trading rights but no clearing rights. He has to associate with a Clearing Member to clear his trades

Trading-Cum-Clearing Member

  • A Trading-cum-Clearing Member should be an existing Member of BSE cash segment.
  • A TCM can trade and clear his trades.In addition,he can also clear the trades of his associate Trading Members

Professional Clearing Member / Custodial Clearing Member

  • A Professional Clearing Member need not be a Member of BSE cash segment.
  • A PCM has no trading rights and has only clearing rights i.e. he just clears the trades of his associate Trading Members & institutional clients.

Limited Trading Member

  • A Limited Trading Member need not be a Member of BSE cash segment.
  • A LTM has only trading rights and no clearing rights. He has to associate with a Clearing Member to clear his trades.

Self Clearing Member

  • A Self Clearing Member should be an existing mMmber of the BSE cash segment.
  • An SCM can clear and settle trades on his own account or on account of his client only and not for any other Trading Member.

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Annexure-2

FINANCIAL REQUIREMENT AND FEE CHART FOR MEMBERS OF BSE DERIVATIVES SEGMENT

 (Rs. in lacs)

Sr. No.

PARTICULARS

PCM / / TCM / SCM

TM

LTM
       

Members of other Stock Exchanges whose Clearing Member is a subsidiary company of a Regional Exchange

Others

1

Net Worth

300( PCM / TCM)
100 (SCM)

25

10

25

2

Security Deposit
 

Interest Free Cash

-

2.5

2.5

2.5
 

Cash/Cash Equivalents (#)

25

2.5

2.5

2.5
 

Approved Securities

25

2.5

2.5

2.5
 

TOTAL

50

7.5

7.5

7.5

3

Processing Fees

-

-

-

-

4

Annual Charges (*)

0.50

0.25

0.25

0.25

5

One Time Charges
 

Exchange Fee (Refundable Deposit)

5

-

-

-
 

IPF Contribution ($)

2

2

2

2
 

TGF Contribution ($)

1

1

1

1
 

TOTAL

8

3

3

3

6

Recurring Charges
 

Transaction Charges

0.25 per lac

0.25 per lac

0.25 per lac

0.25 per lac

(#) – Cash Equivalents include Bank Guarantees and Fixed Deposit Receipts.

(*) - Annual Charges & One Time Charges are presently waived.

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Annexure-3

(for Members other than Clearing Members of Derivatives segment)

Name of the Member
Clearing No.
Statement of Networth as on --------
  particulars

Rs.

Rs.

Rs.

Annexure

1

 Paid-up Capital        
  Equity

x

      
  Prefrence (redeemable after one year)

x

      
  Share Application Money

x

      
  Capital  

x

    

2

 Free Reserves (excluding 'Revaluation Reserve')  

x

    

3

 Market value of listed (quoted) securities in the name of applicant (forming part of the Balance Sheet)

x

     A+E
  minus Book Value of these securities

x

x

   A+E
           

4

 Sub-total (Items 1+2+3)    

x

  
           
  Less:        

5

 Prepaid Expenses  

x

    

6

 Losses/Accumulated losses  

x

    

7

 Miscellaneous Expenditure  

x

    

8

 Deferred Expenditure  

x

    

9

 Sub-total (Items 5+6+7+8)    

x

  

10

 TOTAL "A" [Item 4 (-) Item 9]    

x

  
           
  Less: Non-allowable assets        

11

 Fixed Assets (not used for the purpose of business) including land & building  

x

    

12

 Receivables which are older than 3 months  

x

   B

13

 Advances given to associates  

x

   C

14

 Value of the Exchange Card, if included as an asset in the Balance Sheet  

x

    

15

 Doubtful Debts/Advances, not provided for  

x

   D

16

 Market value of Pledged Securities to the extent of actual borrowings  

x

   E

17

          

a

 Market Value of Pledged Securities (other than Government Securities)

x

     E

b

 Funds borrowed against pledge of securities (other than Government securities)

x

     E

c

 Net Pledged Securities [17a (-) 17b]

x

      

d

 30% of Net Pledged Securities (30% of 17c)  

x

    
           

a1

 Market value of Government Securities pledged

x

     E

b1

 Funds borrowed against pledge of Government securities

x

     E

c1

 Net Pledged Securities [17a1(-)17b1]

x

      

d1

 10% of net pledged securities (10% of 17c1)  

x

    
           

18

 Unlisted Securities at Book value  

x

   F

19

 Bad Deliveries (if included as an asset in the Balance Sheet)  

x

    

20

 Intangible assets like goodwill, etc. (excluding Exchange card)  

x

    

21

          

a

 The Market Value of securities (other than pledged or unlisted or Government securities)

x

     A

b

 30% of Item no. 21a  

x

    
           

22

          

a

 The Market value of Government Securities (other than pledged)

X

     A

b

 10% of item no. 22a  

x

    
           

23

 TOTAL "B" [Items 11 to 22]    

x

  
           

24

 NETWORTH ["A" (-) "B"]    

x

  

 

Note   Refer Item no.
1 Contingent liabilities should be mentioned by way of note, specifying the amount & nature of liability.  
2 Any unpaid statutory liability, government dues, taxes, etc. in dispute or in appeal, if not provided for, should also be mentioned by way of note, giving full details such as amount & nature thereof.  
3 In case of borrowings, the details of installments overdue towards principal & interest should also be given by way of a note.  
4 Chartered Accountant certifying the net-worth certificate should give suitable notes explaining the various assumptions he has made & deviations made (if any), from the above guidelines/notes.  
5 Any other information which to the knowledge of the Chartered Accountant will materially affect the net-worth of the Member, should also be mentioned by way of a suitable note to the certificate.  
7 All the items are to be considered at book value, unless specified otherwise.  
8 In case of partnership/proprietorship firms, capital means Net Balances/balance in Partners’/Proprietor’s Capital Accounts/account (Fixed + Current Capital account)

In case of corporate Members, capital means paid-up capital (equity + preference) However, if preference capital is repayable within a period of one year, then it should be excluded.

 1
9 Share Premium, Capital Redemption Reserve, Debenture Redemption Reserve, Sinking Fund Reserve should be added after Free Reserves, under respective headings. 2
10 Market value of securities should be taken on the date of net-worth certificate. 3
11 Unlisted securities should not be considered at item no. 3. 3
12 Pledged securities should be included at point no. 3. 3
13 Government securities are to be included at point no. 3 3
14 Associate concern means any concern in which the Broker Member/Partners/directors have direct/indirect interest in the management or hold more than 10% of the paid up equity capital of such company.
The word "advances" at point no.13 should include the loans/advances given to related entities, sister concerns, firms/companies in which Members are interested directly or indirectly and should be included in item no.13, even though the same are less than three months old.		 13
15 Any payment towards Membership Right to be deducted. 14
16 Miscellaneous expenditure & deferred expenditure means expenditure capitalised & to the extent not written off or adjusted as on the date of the net-worth. 7,8
17 Securities pledged with the Exchange should not be considered at point no. 16 & 17. 16,17
18 Unlisted securities should be deducted, if they are not listed on any Exchange. 18
19 Negative net-worth should be preceded by a (-) sign, i.e. minus sign. 24
20 Securities held as stock-in-trade, should be treated at par with securities held as investments. 3,16,17,18,21,22
21 Annexures are supposed to be enclosed, wherever specified. 3,12,13,15,16,17,18,21,22

 

Annexure "A" to statement of Net-worth
 
Listed Securities (other than pledged)
Particulars
(Name of the Scrips)		 Market value Book Value (RS.) Net (Rs.)
[Market value (-) Book value]
  Rate per share (Rs.) No.of Shares Value (Rs.)    
Government Securities
           
           
Sub-total    

x

x

x
           
Securities other than government securities
           
           
Sub-total    

x

x

x
           
Total    

x

x

x

 

Annexure "B" to the Statement of Net-worth
 

Receivables which are older than 3 months
 
Particulars (Name of the Debtors, etc.)

Rs.
   
   
   
   
Total

x

 

Annexure "C" to Statement of Networth

 

Advances given to Associates
 
 Particulars (Name of the Associates) Rs.
   
   
   
   
Total x

 

Annexure"D" to Statement of Networth
 

Doubtful Debts/Advances, not provided for
 
Particulars (Name of the Debtors, etc.)

Rs.
   
   
   
   
Total

x

 

Annexure "E" to Statement of Net-worh
 

Pledged Securities

 

Particulars
(names of scrips/assets pledged)

Book value(Rs.)

Market value Of securities

 Borrowed Funds(Rs.)
(if can't be segregated against each scrip/group of scrips/assets, put directly the total amt.)
    Rate per share (Rs.) No. of Shares Value (Rs.)
Government Securities
           
           
Sub-total

x

    

x

x
           
Securities other than government securities
           
           
Sub-total

x

    

x

x
           
Total

x

    

x

x

 

Annexure "F" to Statement of Networth
 

Unlisted Securities
 
Particulars (Name of scrips) Book value (Rs.)
   
   
   
   
Total

x

 

Clearing Members of the Derivatives Segment : (including Trading cum Clearing Members), are required to maintain the net-worth criteria of Rs. 3.00 crores, as per the following formula, prescribed by SEBI.

Capital + Free Reserves

Less : non-allowable assets

  1. Fixed assets
  2. Pledged Securities
  3. Member’s card
  4. Non-allowable securities (unlisted securities)
  5. Bad deliveries
  6. Doubtful debts and advances*
  7. Prepaid expenses, losses
  8. Intangible assets
  9. 30% of marketable securities

* Explanation – Includes debts/advances overdue for more than three months or given to associates.

Clarification:

I] Point no. (b) Pledged securities

     Pledged securities are required to be deducted at book value.

II] Point No. (i) 30% of marketable securities

  1. Marketable securities are to be valued at Book value or Market value, whichever is lower. The haircut of 30% shall be applicable on the Book value or the market value, whichever is lower. Considering this, the point (i) is reproduced as below: "30% (of Book value or Market Value, whichever is lower) of marketable securities"


  2. Pledged securities are not to be considered at point no. (i)


  3. Securities held as stock-in-trade, are not to be considered at point no. (i)

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Annexure-4

TWS & VSAT Charges

  • If already BOLT terminals are there derivatives terminal connectivity can be given through the same VSAT’s / leased lines
  • First two derivative terminals per Member are free of cost
 

3

TWS/VSAT Charges for additional Terminals
  TWS Charges Rs. 1,000/- per TWS per month (First two terminals per Member will be free
     
  VSAT Charges Rs. 11,500/- per month per VSAT in case of new VSAT

* existing VSAT can also be used for which no charges will be levied

Note : The below form should be submitted on the Members letter head)

Form for applying for Derivatives Trader Work Station

Membership Services & Development
Bombay Stock Exchange Ltd.
P. J. Tower,28th Floor
Dalal Street
Mumbai-400001

Subject :Installation of Derivatives Trader Work Station (DTWS)

I/We request you to approve the under mentioned address as my/our approved office. (This line may be omitted if the office is already an approved office).

I/We request you to arrange to install ______ (specify number) DTWS at the following address. I/We have connectivity on BOLT Network and DTWS is to be installed on Ethernet / Lease Line / VSAT. (Tick appropriate stage of the network. I/We confirm that computer/s with minimum configuration of Pentium II, 128 MB RAM, 4 GB HDD, 1.44 MB FDD, CD ROM Drive, Ethernet card and Windows NT 4.0 (Service Pack 5.0) is available at the office.

Mr./Ms. _______________________will be the authorized person for this office and Mr./Ms. __________________________will be the approved user of the DTWS. The proof of passing the requisite certification exam for the approved user is enclosed.

Address1______________________________

Address2_______________________________

Address3________________________________

City________________________________

State_________________________________

PIN_________________________________

Phone No. 1 ___________________________

Phone No. 2 ___________________________

Fax No. _______________________________

E-mail ________________________________

I/We undertake to abide by the Rules, Bye-laws and Regulations of the Derivatives Segment of Bombay Stock Exchange Ltd.

Signature and Rubber Stamp of the Member

Clearing Number:

Derivatives Membership Code:

SEBI Registration No.:

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Annexure-5

List of Clearing Banks with addresses - Derivatives Segment:

S.R.No Address Contact Person Contact No
1 Bank of India
Stock Exchange Branch,
Fort, Mumbai, 400 023
 Mr. Jadhav/Shirsat/ Mohan Intercom: 8131/ 8130/ 5029
2 ICICI Bank Ltd.
ICICI Capital Market Division,
30, Mumbai Samachar Marg,
Fort, Mumbai, 400 001.
 Mr. Krishnan/ Prasad Te.Nos. 2655206/ 5284-87
Direct Line : 2655208
Hotline: 3005
3 Centurion Bank Ltd.
Bandukwala Bldg., British Hotel Lane,
Off. Bombay Samachar Marg,
Fort, Mumbai, 400 023.
 Mr Rajshekhar Tel.Nos. 2705062/ 5036/ 5039/ 4883
Hotline: 3001
4 Global Trust Bank Ltd.
67, Sonawala Building,
Samachar Marg, Fort,
Mumbai, 400 001. 		Mr. Rajesh / Mr. Bibhash Tel.Nos. 2694256/2654791-97
Hotline: 3002
5 HDFC Bank Ltd.
Kalpataru Heritage
Nanik Motwani Marg
Ground floor
Fort. 		Mr. Anant/ Ishraq Tel.Nos. 2705502/1999/1616/3347
Ext.Nos. 110 To116
Hotline: 3003
6 Standard Chartered Bank
Institutional Banking Group,
23-25, Mahatma Gandhi Road,
2nd Floor, Mumbai, 400 001. 		Mr.Sujit/Pratap/Ms.Devika/Manoj Tel.Nos. 2677000/ 1301
Direct Line: 2690253
Hotline: 3007

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