FMC will have the same KYC document for commodity derivatives market as prescribed by SEBI for securities market
There will now be a common know your customer (KYC) process for both commodity and stock markets. Commodities regulator Forward Markets Commission (FMC) has modified its norms to make it easier for clients to register for trading in these two financial markets.
On Saturday, Finance Minister Arun Jaitley announced that the FMC would be merged with capital market regulator Securities and Exchange Board of India (SEBI); the latter will now oversee both equity and commodities markets.
"The Commission has decided that KYC document of the commodity derivatives market will be identical to that prescribed by the SEBI for the securities market," commodity markets regulator FMC said in a circular to all national commodity bourses.
This is being done to enable uniform KYC registration process in the two financial markets to make it easier for clients to register for trading and to avoid duplication of paper work with various intermediaries, it said.
According to the FMC, the modified KYC documents would comprise of a KYC form for 'individuals only ' and another 'non-individuals only' as prescribed by SEBI.
The other documents include uniform risk disclosure document along with rights and obligations of members, authorised persons and clients as well as do's and don'ts for the clients, it said, adding that these three documents will remained unchanged.
The commodity bourses have been asked to bring the provisions of this circular to the notice of their members and also disseminate the same through their website.
The exchanges have been asked to make amendments to the relevant bye-laws, rules and regulations for the implementation of the modified KYC norms.
Currently, there are four national and six regional commodity bourses operating in the country.