OBLIGATIONS AND RESPONSIBILITIES OF DESIGNATED DEPOSITORY PARTICIPANTS (DDPs) :

• All designated depositary participants (DDPs) who have been granted approval by SEBI shall –

– Comply with the provisions of these regulations, circulars and any other terms and conditions specified by SEBI from time to time;

– Forthwith inform SEBI in writing, if any information or particulars previously submitted to SEBI are found to be false or misleading, in any material respect;

– Forthwith inform SEBI in writing, if there is any material change in the information previously furnished by him to SEBI.

– Furnish such information, record or documents to SEBI and RBI, as may be required, in relation to his activities as a DDP.

– Ensure that only registered foreign portfolio investors are allowed to invest in securities market.

– Ensure that foreign portfolio investor does not have opaque structure(s).

However, the foreign portfolio investor satisfying the following criteria shall not be treated as having opaque structure:

• The applicant is regulated in its home jurisdiction

• Each fund or sub fund in the applicant satisfies broad based criteria, and

• The applicant gives an undertaking to provide information regarding its beneficial owners as and when Board seeks this information.

– have adequate systems to ensure that in case of jointly held depository accounts, each of the joint holders meet the requirements specified for foreign portfolio investors and shall perform KYC due diligence for each of the joint holders;

– in case of any penalty, pending litigations or proceedings, findings of inspections or investigations for which action may have been taken or is in the process of being taken by any regulator against a DDP, the DDP shall bring such information forthwith, to the attention of SEBI, depositories and stock exchanges;

– be guided by the relevant circular on Anti-Money Laundering or Combating the Financing of Terrorism specified by SEBI from time to time.

• The designated depository participant engaged by an applicant seeking registration as foreign portfolio investor shall:-

– ascertain at the time of granting registration and whenever applicable, whether the applicant forms part of any investor group;

– open a dematerialized account for the applicant only after ensuring compliance with all the requirements under Prevention of Money Laundering Act, 2002 and rules and regulations prescribed thereunder, Financial Action Task Force standards and circulars issued by SEBI in this regard, from time to time and shall also ensure that foreign portfolio investors comply with all these requirements on an on going basis;

– carry out necessary due diligence and obtain appropriate declarations and undertakings from applicant to ensure that no other depository account is held by any of the concerned applicant as a foreign portfolio investor or as a non-resident Indian, before opening a depository account;

– ensure that equity shares held by foreign portfolio investors are free from all encumbrances;

– collect and remit fees to SEBI, in the manner as specified in Part A of Second Schedule; and

– in case of change in structure or constitution or direct or indirect change in beneficial ownership reported by the foreign portfolio investor, re-assess the eligibility of such foreign portfolio investor.