IFSCA Official had introduced a comprehensive framework for depository participants operating within the GIFT City IFSC. This framework is designed to streamline processes, ensure compliance, and enhance investor protection. Below, we outline the essential components of the framework.
Recognized Depositories and Participants
Recognized Depository: A depository in IFSC recognized by the Authority. India International Depository IFSC Limited (IIDI)
Depository Participant: A participant of a recognized depository.
Permissible Clients
Depository participants can serve the following categories of clients:
Persons resident outside India.
Non-resident Indians.
Non-individual residents in India eligible under FEMA for offshore investments.
Individual residents in India eligible under the Liberalized Remittance Scheme of the Reserve Bank of India.
Permissible Activities
Depository participants must comply with applicable laws, including bye-laws, rules, and regulations specified by the recognized depository. Key responsibilities include:
Opening separate accounts for each beneficial owner.
Maintaining adequate internal controls and data integrity.
Daily reconciliation of records with the depository.
Structure of Eligible Entities
Entities eligible for registration include companies, LLPs, body corporates, and partnership firms, including their existing unit branches.
Net Worth Requirement and Fee Structure
Entities must maintain a prescribed net worth and adhere to the following fee structure:
Application Fee: USD 500
Registration Fee: USD 500
Annual Fee: USD 500 from the next financial year after application approval.
Staff Requirements
To become a registered custodian, entities must appoint a Principal Officer with:
A professional or post-graduate degree in relevant fields.
At least five years of experience in the securities market or related financial services.
Entities must also ensure sufficient staff with relevant qualifications for operational roles.
Code of Conduct
Depository participants must adhere to a strict code of conduct, ensuring:
Timely and diligent service to beneficial owners.
Maintenance of data integrity and security.
High standards of integrity, fairness, and professionalism in business conduct.
Protection of investor interests and avoidance of conflicts of interest.
General Capital Market Intermediary Code of Conduct
Participants must also comply with broader market intermediary guidelines, including:
Protection of investor interests.
Avoidance of manipulative, fraudulent, or deceptive practices.
Confidentiality of client information.
Prompt reporting of any regulatory actions or material changes to the Authority.
Tax Benefits
100% Tax Exemption: Business profits are fully exempt for 10 years out of the first 15 years of operation.
Minimum Alternate Tax (MAT): Reduced MAT rate of 9% for IFSC units.
For more details, visit: Tax Benefits in GIFT IFSC
#IFSCAFramework #GIFTCity #IFSC #DepositoryParticipants #InvestorProtection #FEMA #LiberalizedRemittanceScheme #NetWorthRequirement #PrincipalOfficer #CodeOfConduct #TaxExemption #MAT #FinancialServices #Compliance #SecuritiesMarket #FinancialInclusion #EconomicGrowth #GlobalFinance #InvestmentOpportunities #RegulatoryFramework #MarketIntegrity #DataSecurity #InvestorInterests #ProfessionalStandards #FinancialOperations #InternalControls #ClientConfidentiality #CapitalMarket #MarketIntermediaries #FraudPrevention #EthicalStandards #OperationalExcellence #BusinessCompliance #FinancialRegulations #InvestorAdvisory #ProfessionalIntegrity #ConflictOfInterest #TaxIncentives #FinancialPlanning #WealthManagement #GlobalInvesting #EconomicDevelopment #FinanceDegree #SecuritiesCompliance #InvestmentCompliance #MarketConduct #RegulatoryCompliance #FinanceCareers
Disclaimer: This post is for informational purposes only and does not constitute professional advice. While efforts are made to ensure accuracy, we do not guarantee the completeness or reliability of the information provided. Any reliance is at your own risk. Consult professionals for specific advice.
Comments