Depository (Operational) Regulations, 2003 (Updated as of 6 November 2022)

[Updated as of 6 November 2022]
Depository (Operational) Regulations, 2003
Bangladesh Gazette
Extraordinary Issue
Published by Authority
Sunday, May 04, 2003
[Volume 8 -- Notifications and Notices Issued by Private Persons and Corporations under Authority] Securities and Exchange Commission DEPOSITORY (OPERATIONAL) REGULATIONS, 2003

Notification
Date, 01st April 2003/18th Chaitra 1409 Bangabda No.-SEC/CMMRCD/2001-63/Admin-01/17- In exercise of the powers conferred by Section 17 of the Depository Act, 1999, and after previous publication, the following regulations are hereby made, namely:

First Chapter
Preliminary

1. Short title. - These regulations shall be called the Depository (Operational) Regulations, 2003.

2. Definitions. - (1) Unless the context otherwise requires, in these regulations:
   (a) "Act" means the Depository Act, 1999 (Act No. 6 of 1999); (b) "Electronic communication" means any communication system in electronic form including computers; (c) "Sub-law" means the sub-laws of the Depository made under the Act; (d) "Schedule" means any Schedule annexed to these regulations; (e) "Operations Manual" means the Operations Manual of the Depository; (f) "Person" includes a company, a statutory body, a partnership firm, or any other class of institution; [(g) "Record Date" means any specific date declared by the issuer, on which the Depository Registrar shall be entitled to the votes of the registered members to participate in the said issuer's general meeting, special general meeting, etc., and to receive declared dividends, rights/bonus shares, and other benefits.] (2) Words and expressions used in these regulations which are not defined herein shall have the same meaning as assigned to them in the Securities and Exchange Commission Act, 1993 (Act No. 15 of 1993), the Companies Act, 1994 (Act No. 18 of 1994), and the rules and regulations made thereunder.

1 Inserted by Notification No. SEC/CMMRCD/2001-63/Admin-01/27, dated 20 July 2006, which was published in the Bangladesh Gazette on September 27, 2006.

3. Declaration of emergency. - (1) In the event of any special situation affecting the control of the Depository (such as earthquake, sabotage, natural calamity, fire, etc.) resulting in disruption or failure of communication, electricity, or telephone systems, a Depository may declare an emergency in consultation with the Commission.
   (2) In the declared emergency, the Depository may make temporary special arrangements for the transaction process, which shall be intimated in writing to the Commission immediately (within twenty-four hours).

4. Arrangements and procedures for disaster management. - Adequate arrangements shall be in place to immediately manage disasters arising from technical glitches or any other cause in the Depository, and the related procedures shall be stipulated in the Administration Manual.

5. Security of Depository information. - The Depository shall take all such measures, including emergency systems, to ensure that information recorded in the Depository remains completely safe and secure, so that it is not lost or distorted, that internal and external (inbound and outbound) data transmission is encrypted, and that no one collects or uses such information in any manner other than as permitted by the provisions or procedures of the Depository Act, Depository Regulations, these regulations, or the Depository's sub-laws.

6. Internal evaluation, monitoring, and control arrangements. - The Depository shall have adequate internal evaluation, monitoring, and control arrangements to ensure its systems, operations, controls, and security.

7. Arrangements for preservation of information, records, etc. - (1) The Depository shall preserve the following information, records, etc., in accordance with the procedures prescribed by sub-laws, namely:
   (a) Records of securities that have been deposited or re-deposited; (b) Names, addresses, and dates of transfer of transferors and transferees; (c) Lists or indices of account holders for all securities; (d) Records of all instructions sent to and received from Depository participants, issuers, issuer representatives, and account holders; (e) Records related to pledges; (f) Detailed information regarding all participants; (g) Details of securities declared eligible for preservation in a deposited state; (h) Applicable details regarding securities lending and borrowing; and (i) Any other information or records prescribed by the Commission from time to time for preservation. (2) The Depository shall inform the Commission in writing in advance of where its information, records, and documents are preserved. (3) Subject to the provisions of any other law, the Depository shall preserve its information, records, and documents for a minimum of seven years.

8. Regular inspection arrangements. - For proper operation, the Depository shall regularly inspect its systems, operations, controls, and security arrangements, and submit a copy of the inspection report to the Commission.

9. Arrangements for preservation of electronic communication for transactions by the Depository. - The Depository shall ensure arrangements for the preservation of electronic communication for transactions with security issuers, Depository participants, stock exchanges, clearing corporations or houses, clearing banks, and any other Depository, or any person, firm, or institution directed by the Commission.

10. Cooperation with other persons or institutions. - The Depository shall cooperate with each account holder, beneficial owner (where applicable), Depository participant, issuer, issuer's agent, custodian of securities, clearing bank, stock exchange, clearing corporation or house, and any other Depository, or any person, firm, or institution directed by the Commission, in such a manner as to ensure reliable, fast, and secure service delivery.

11. Coordination with clearing and settlement arrangements. - The Commission shall inform the Depository of any proposal for changes in the clearing and settlement arrangements as soon as possible, and the Depository shall take appropriate steps to promptly coordinate such changes in its system with the Commission's approval.

12. Arrangements for indemnification. - The Depository shall have adequate arrangements to provide legal indemnification to any person affected due to the Depository, which may include insurance:
    Provided that the insurance company, any of its affiliated organizations, or any of their directors, shareholders, or representatives shall not be included in or remain in the Depository's board during the term of the insurance.

13. Prohibition on delegation of Depository duties or responsibilities. - The Depository shall not delegate its Depository work to anyone else without the prior approval of the Commission.

14. Regulations regarding dissolution of Depository. - If any Depository wishes to dissolve, it shall first make a written application to the Commission for approval of dissolution, including the following information:
    (a) The reason for the dissolution of the Depository; (b) A description of how the Depository wishes to dissolve; (c) Details of how the security recorded in the Depository will be preserved and protected, and what will happen to such securities after the dissolution of the Depository; (d) Detailed information on what arrangements will be made for liabilities with persons or institutions with whom the Depository has entered into agreements regarding securities; and (e) Any other information required by the Commission:
    Provided that a Depository shall not commence formalities related to dissolution only after obtaining the written approval of the Commission.

Second Chapter
Eligible Securities for Preservation

15. Securities eligible for preservation in the Depository. - The Depository shall determine which securities are eligible for and eligible to be preserved in the Depository in a deposited state, in the manner specified in its sub-laws.

16. Classification of eligible securities. - A Depository may classify eligible securities into the following categories and, subject to the sub-laws, may determine what type of eligible securities a participant may hold or preserve, namely:
    (a) Securities listed on the Stock Exchange;
    (b) Bonds issued by the Government, market securities, or any other securities considered as bond market securities; and (c) Other securities, which may include equity and bond securities, mutual fund units, commercial papers, etc.

17. Eligible securities for listing. - (1) After the issuance of the Business Operation Certificate, the Commission shall determine a specific date within which all or any specific securities listed on the Stock Exchange shall be declared as eligible securities. Thereafter, no transaction of all or any specific securities shall be made on the Stock Exchange except in a deposited state after the date determined by the Commission:
    Provided that the Commission may, if it deems necessary, change the said date and grant exemption for any security to be considered an eligible security:
    Further provided that all newly listed securities on the Stock Exchange after the date of approval of the Depository's sub-laws by the Commission shall be considered eligible securities, and no transaction shall be made on the Stock Exchange except in a deposited state. (2) Subject to the provisions of sub-regulation (1), any Stock Exchange shall cease to provide listing facilities for any security that has not been declared as an eligible security.

18. Agreement between Depository and Issuer for preservation in the Depository. - The Depository and the Security Issuer shall enter into an agreement for preservation in the Depository in the manner prescribed by the Depository's sub-laws:
    Provided that where the Depository itself is the issuer, no such agreement shall be required, but in such cases, the applicable provisions regarding the issuer shall also apply to the Depository.

19. [*]

Third Chapter
Account Maintenance

20. Account facilities. - The Depository may provide facilities for the following account operations, namely:
    (a) Clearing Account - Trading participants, Custody participants, Settlement Agent participants, and Re-service participants may use this account for settling transactions on the Stock Exchange.
    (b) Main Account - Trading participants, Custody participants, and Re-service participants may use this account for preserving their own securities.
    (c) Customer Account - Re-service participants and Custody participants may use this account for preserving securities in the name of investors.
    (d) Omnibus Account - Re-service participants and Custody participants may use this account for preserving the accounts of multiple investors together.
    (e) Direct Account - The Depository may use this account for directly preserving securities of investors.
    (2) The Depository shall have such arrangements that any account can be identified simultaneously.
    (3) Each account shall be opened in the manner specified in the sub-laws.

1 Notification No. SEC/CMMRCD/2001-63/287/Admin-02/8 dated 11 April 2004, published in the Bangladesh Gazette on 16 May 2004, has been repealed.

21. Direct Account. - (1) The Depository may open only one Direct Account in a single name.
    (2) The holder of a Direct Account shall not keep securities of any other person in their own account.
    (3) The Depository may transfer the securities of the holder of a Direct Account only according to written instructions.
    (4) Subject to transactions, the Depository shall provide the holder of a Direct Account with a monthly statement of the account after any transaction is completed, in which transactions of all securities from the previous statement to the current statement shall be recorded. If there are no transactions, the said statement shall be provided on a quarterly basis.

22. Reconciliation. - The Depository and its participants shall have such systems and arrangements through which accurate account reconciliation of securities can be done among the Issuer, Depository, and Depository participants. Whenever a security is included in or withdrawn from the Depository Register, the Issuer shall reconcile the status of deposited securities with the Depository.

23. Execution of contracts by Depository participants with account holders. - Depository participants shall execute contracts with all account holders in the format specified in the Depository's sub-laws.

24. Opening separate accounts for account holders by Depository participants, etc. - (1) Depository participants shall open separate accounts for all their account holders in the manner prescribed by the sub-laws, preserve their securities according to separate accounts, and shall not mix securities of one account with those of another.
    (2) Depository participants shall transfer securities in their accounts upon receiving instructions from the account holders, in the format specified in the Depository's sub-laws.

25. Providing account statements, etc., by Depository participants to account holders. - Depository participants shall provide account statements to all their account holders at specified intervals, according to the contracts executed with them and the provisions of the Depository's sub-laws.

26. Opening accounts with Depository participants, etc.
    1
    [(1) A person wishing to avail services of the Depository may open an account with a Depository participant of their choice. Upon receipt of the duly filled application form for opening an account and relevant documents as specified in the Depository's sub-laws, the Depository participant shall verify the identity of the applicant, enter all information and signatures into the system, open the account, and inform the applicant in writing of the account number:
    Provided that, except for institutional investors, no one may open more than one account with the same Depository participant.]
    (2) Persons in the individual category and institutional investors shall apply to open the said account with a Depository participant of their choice by filling out the forms specified in the sub-laws, and the Depository participant shall take immediate arrangements accordingly. (3) An application to close an account held with a Depository participant shall be made by filling out the form specified in the sub-laws, and the Depository participant shall take immediate arrangements accordingly:
    Provided that if any pledged securities are held in the relevant account, the said account shall not be closed without the prior permission of the pledgee.

1 Replaced by Notification No. SEC/CMMRCD/2001-63/Admin-01/27, dated 20 July 2006, published in the Bangladesh Gazette on September 27, 2006.

Fourth Chapter
Depository Participants

27. Registration of Depository Participants. - (1) No Depository Participant shall work as such without obtaining a Registration Certificate under these regulations.
    (2) For registration as a Depository Participant:
    (a) An application shall be made to the Commission through the relevant Depository in the format provided in Schedule-'1', along with the recommendation of the Commission-certified Depository; 1 [(b) The prescribed fee for the application mentioned in the said form shall be deposited with the Commission through Pay Order, Bank Draft, or Electronic Fund Transfer, along with the documents and information mentioned in the said form:
    For Custody Participants --------------------- BDT 2,00,000 For Trading Participants ----------------------- BDT 50,000 For Other Participants ---------------------- BDT 1,00,000.]
    (c) The Depository shall fill in the specified parts of the received application and submit it to the Commission within seven working days, along with the said Bank Draft or Pay Order; (d) If the Depository determines for any reason that an application cannot be recommended to the Commission for registration, it shall inform the applicant in writing within seven working days, stating the reasons, a copy of which shall be sent to the Commission along with the received Draft or Pay Order:
    Provided that if the decision not to recommend the application to the Commission is due to reasons that can be rectified by the applicant, the applicant may re-apply after rectifying the said reasons, and in such case, no re-application fee shall be paid.

1 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.

28. Eligibility for registration as a Depository Participant. - Any person shall be eligible for registration as a Depository Participant under these regulations if:
    (1) The applicant belongs to any one of the following categories, namely:
    (a) Any financial institution defined in the Financial Institutions Act, 1993 (Act No. 27 of 1993); (b) Any bank company defined in the Bank Companies Act, 1991 (Ordinance No. 46 of 1991); (c) Any insurance company defined in the Insurance Act, 1938 (Act No. 4 of 1938); (d) Any company formed under the Companies Act, 1994 (Act No. 18 of 1994) or any statutory or registered body established or formed under any other law; (e) Any clearing corporation approved by the Commission, or the clearing house of a Stock Exchange; (f) Any corporate stock dealer, stock broker, merchant banker, asset manager, custodian, or any other capital market intermediary certified by the Commission:
    Provided that in the case of a stock dealer or stock broker, its paid-up capital shall be at least twenty-five lakh Taka, of which at least 75% shall be kept as current net assets:
    Further provided that in the case of a stock dealer or stock broker wishing to become a Trading Participant, the above provision shall not apply:
    Further provided that in the case of a dealer or stock broker, the eligibility regarding corporations mentioned in clause (f) of sub-regulation (1) of regulation 28 shall be subject to the relevant rules mentioned in the Securities and Exchange Commission (Stock Dealers, Stock Brokers and Approved Representatives) Regulations, 2000 issued by the Commission; (g) Any other institution determined by the Commission from time to time for this purpose; and (2) The applicant has the infrastructure, security arrangements, and suitable manpower prescribed by the Depository's sub-laws.

1 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.

29. Classification of Depository Participants. - A Depository may classify participants into the following categories, subject to the sub-laws, namely:
    (a) Trading Participants - Only stock dealers or stock brokers can be participants of this category and may operate clearing accounts for settling transactions on the Stock Exchange along with operating their own accounts. (b) Re-service Participants - Participants of this category may operate their own accounts, clearing accounts, and investors' accounts. (c) Custody Participants - Participants of this category may operate their own accounts, custody accounts for their customers, and clearing accounts for stock brokers or stock dealers. (d) Settlement Agent Participants - Participants of this category must be approved by the Commission and may only operate accounts for providing services for settling transactions conducted on the Stock Exchange by stock brokers or stock dealers certified by the Commission.

30. Registration as a Depository Participant. - (1) Upon receiving an application for registration as a Depository Participant, if the Commission is satisfied that the application is eligible for approval under these regulations, it shall approve the application within ten working days of receiving the application and issue a Registration Certificate in the format provided in Schedule-'2' in favor of the applicant.
    (2) If more information is required to consider an application for registration, the Commission may request the said information within seven days of receiving the application; and upon receiving the said information within the time determined by the Commission, if the application is found acceptable, the Commission shall approve it and issue a Registration Certificate in favor of the applicant within ten working days of receiving the additional information. 1 [: ] 2 [Provided that the prescribed fee for registration shall be deposited with the Commission through Pay Order, Bank Draft, or Electronic Fund Transfer, in the following amounts:
    For Custody Participants --------------------- BDT 5,00,000 For Trading Participants ----------------------- BDT 1,00,000 For Other Participants ---------------------- BDT 2,00,000.]
    (3) After examining an application for registration, if the Commission comes to the conclusion that the application is not eligible for approval under these regulations, or that approving it would not be conducive to the capital market or public interest, it may reject it in writing, stating the reasons, within ten working days of receiving it, or within ten working days of receiving additional information under sub-regulation (2):

1 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.
2 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.

Provided that the applicant may re-apply to the Commission through the Depository after rectifying the said reasons.
1
[(4) Any Registration Certificate issued by the Commission shall remain valid for (a) five years in the case of Custody Participants, and (b) one year in the case of Trading and Other Participants, from the date of issuance subject to the conditions mentioned therein.] (5) If any information provided by the Depository participant is subsequently changed, it shall be intimated in writing to the Depository and the Commission immediately. 2 [(6) In every case, an application in the format provided in Schedule-3 through the Depository, along with the prescribed renewal fee deposited with the Commission through Pay Order, Bank Draft, or Electronic Fund Transfer, shall be submitted to the Commission to renew the Registration Certificate for (a) five years in the case of Custody Participants, and (b) one year in the case of Trading and Other Participants:
For Custody Participants --------------------- BDT 5,00,000 For Trading Participants ----------------------- BDT 1,00,000 For Other Participants ---------------------- BDT 3 [BDT 50,000:
Provided that in the case of Other Participants, the renewal fee of BDT 50,000 has been effective from August 22, 2021.]
(7) The application for renewal of the Registration Certificate mentioned in sub-regulation (6) shall be submitted to the Commission one month prior to the expiry of the period mentioned in the Registration Certificate; otherwise, a fine of 4 [BDT 5,000 per day] shall be deposited with the Commission for each day of delay.]

31. Contract with customers. - (1) In the case of maintaining customer accounts and omnibus accounts by participants, there shall be a written contract with each customer.
    (2) The type of such contract shall be determined by the Depository's sub-laws.

32. Control over accounts by Depository Participants. - (1) Securities of customers shall be preserved separately from the securities of the participant, except for securities held in the Clearing Account.
    (2) Trading Participants, Custody Participants, Settlement Agent Participants, and Re-service Participants may open Clearing Accounts for settling transactions according to the sub-laws.
    (3) Re-service Participants and Custody Participants may open accounts in the name of investors and, subject to mutual agreement, omnibus accounts.
    (4) Settlement Agent Participants may open Clearing Accounts for their customers, i.e., stock brokers or stock dealers.

1 Replaced by No.-SEC/CMMRCD/2001-63/Admin/01-38 dated 11th March 2009.
2 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.
3 Replaced by Notification No. No.-BSEC/CMMRCD/2022-407/44/Admin/137 dated 22 September 2022, published in the Bangladesh Gazette on October 26, 2022.
4 Replaced by Notification No. BSEC/CMMRCD/2019-392/26/Admin/126 dated 30 June 2021, published in the Bangladesh Gazette on August 22, 2021.

(5) A stock broker or stock dealer shall transfer securities from the client's account to the clearing account only after receiving a sell order from the client. If a sell order is executed, it shall be transferred to the clearing account before the end of the business day. If a sell order is cancelled, it shall be transferred back from the clearing account to the client's account before the end of the business day: Provided that, in the case of registered certificate-issuing custodial service providers, the existing rules regarding this shall apply to them.

(6) Transactions made through the stock exchange shall be settled in accordance with the settlement rules.

(7) All participants shall maintain details regarding the true ownership of the clearing and pooled accounts at all times and shall be obliged to provide them upon demand by the Depository or the Commission.

33. Maintenance of electronic connection, etc., by Depository Participants.- Depository Participants shall ensure the maintenance of electronic connections with the Depository in the manner prescribed in the sub-rules of the Depository, in which they are participants.

34. Maintenance of information, records, etc., by Depository Participants.- (1) Depository Participants shall have arrangements for internal evaluation and inspection to ensure the maintenance of appropriate information, records, etc., in the manner prescribed by the sub-rules.

(2) Depository Participants shall reconcile their records with the Depository every business day.

(3) Depository Participants shall submit returns (in the specified format) to the Depository at specified intervals in the manner prescribed in the sub-rules of the Depository.

(4) Every Depository Participant shall provide information specified in the demand letter to the Commission upon request.

(5) Depository Participants shall always maintain and keep ready the following information for inspection and verification by the Commission, the Depository, or any person or institution appointed by the Commission, among others, namely: -

(a) Information regarding every transaction of the Depository and the account holder; (b) All records regarding consolidated (consolidated) and re-consolidated securities executed through the Depository Participant; (c) All instructions received from each account holder and copies of statements sent to them; and (d) All information regarding pledges.

(6) Depository Participants shall inform the Commission and the Depository in writing in advance of the location where they store their information, records, etc., and shall inform the Commission and the Depository in writing immediately of any change therein.

(7) Subject to the provisions of any other applicable law, Depository Participants shall retain their information, records, and documents for a minimum of seven years.

35. Separate maintenance of information in case of multiple Depository Participants.- If any entity is a participant of multiple Depositories, the information, records, etc., mentioned in Rule 34 shall be maintained separately for each Depository.

36. Inspection of business premises of Depository Participants.- Depository Participants shall always allow any authorized person appointed by the Commission or the Depository to enter their business premises and inspect their business, records, etc., at any time.

37. Prohibition on outsourcing business of Depository Participants.-

No Depository Participant shall outsource the business of its Depository participation to any other person without the prior approval of the Depository.

Chapter Five
Deposit or Re-consolidation of Securities

38. Deposit, etc., for deposit of securities.- (1) When the Depository declares any security eligible for deposit, the owner of such security may deposit the security in its own name with the Depository or by opening an account with a Depository Participant, or if it is a custodian, in the name of its client, with the issuer for deposit.

1
[(2) In the case of deposit of securities (consolidation), except for pooled accounts, securities in a single name shall be included in a corresponding single-name Depository account, and securities in a joint name shall be included in a corresponding joint-name Depository account.

(3) In the case of initial share allocation through IPO (IPO), except for pooled accounts, if applied for in a single name, it shall be included in a corresponding single-name Depository account, and in the case of joint name applications, it shall be included in a corresponding joint-name Depository account.]

39. Change of deposited securities to re-consolidated status.- Subject to the provisions of the sub-rules, anyone who wishes may change their deposited securities held in their account back to the re-consolidated status.

40. Process of deposit and re-consolidation of securities.- The process of deposit and re-consolidation of securities shall be prescribed by the sub-rules.

Chapter Six
Transfer of Ownership of Securities

41. Assurance of payment of consideration in case of transfer of ownership of securities.- The Depository shall ensure that there is an arrangement through which, in the case of securities transactions on the stock exchange, the ownership of the securities shall be transferred only after the assurance of payment of consideration, if applicable.

42. Transfer of ownership of securities from one account to another other than on the stock exchange, etc.- (1) Depository Participants shall not transfer any security without the written permission of their account holder.

(2) If any account holder or respective account holder wishes to transfer securities from their account to another account, they shall submit the form prescribed in the sub-rules, along with the permission letter of the stock exchange or the Commission, if applicable, to the Depository Participant or the Depository. The Depository Participant or Depository shall verify the authenticity of the information provided in the said form and, if correct, record it in their system immediately.

(3) If any account holder or respective account holder wishes to transfer securities in their account, they shall submit the form prescribed in the sub-rules to the Depository Participant or Depository for transfer, and the Depository Participant or Depository shall record it in their system.

(4) Anyone who wishes may give instructions to the Depository Participant for the transfer of securities at a specified time or at all times, and in that case, they shall not be required to fill the form prescribed in the sub-rules every time.

(5) When the transfer and transmission orders of securities are matched, the securities shall be immediately transferred and transmitted from one account to another through an automatic process.

1 Inserted by Notification No. SECI/CMMRCID/2001-63/Admin-01/27, dated 20 July 2006, published in the Bangladesh Gazette on September 27, 2006.

(6) If the Depository cannot transfer or transmit any security due to erroneous recording, in that case, the Depository shall deposit it in a temporary account head until the investigation or inquiry into this matter is completed.

(7) If any account holder or respective account holder dies, their legal heir shall apply to the Depository Participant or Depository where the securities are received, by filling the form prescribed in the sub-rules for transmission (transmission). In the case of the account holder, the participant, and in the case of the respective account holder, the Depository shall perform the transmission after verifying the necessary documents.

43. Supply of information to the issuer regarding registered owners in the Depository Register.- (1) Every Depository shall regularly supply information (name, address, number of securities, etc.) of the ownership of securities registered in the Depository Register of that issuer to the issuer through the system for sending half-yearly reports, annual reports, cash or stock dividends, filing returns to the register, etc., and the issuer shall act according to the said information.

(2) The process regarding the exchange of information shall be prescribed by the sub-rules.

Chapter Seven
Provision of Other Facilities

44. Pledge facility.- (1) The Depository or the participant of the Depository may provide pledge facility to their clients.

(2) For the pledge, the Depository or the participant of the Depository shall process the pledge if the pledge request form (Pledge Request Form) provided in the sub-rules of the Depository is submitted with the consent of the pledgor and the pledgee.

(3) While the pledge exists, it shall be recorded in the name of the pledgor in the Depository's account.

(4) The securities kept in pledge may be transferred according to the instructions of the pledgee in the manner prescribed by the sub-rules during the period of pledge.

45. Facility regarding lending and borrowing of securities.- Subject to the prior approval of the Commission, the Depository may provide facilities regarding lending and borrowing of securities subject to the rules issued by the Commission regarding lending and borrowing of securities.

46. Issue of Bonus and Rights Shares.
    1
    [(1) When any issuer issues any bonus or rights shares, the securities of all issuers kept in the Depository shall be allocated through the system and included in the Depository, which shall be processed after verification upon receiving the written instructions of the issuer along with the relevant documents.

2
(2) In the case of eligible declared securities (where the securities of all companies are traded in deposit status on the stock exchange), the issuer shall declare a Record Date (Record Date) on a specified date (one day) after the Book Closure for the declaration of corporate events (such as dividends, rights issues, etc.), and all shareholders whose names are included in the Depository Register at the end of the business day of the said Record Date shall be entitled to receive dividends, rights shares, etc., according to the declaration.

(3) No transaction of the relevant securities on the stock exchange shall take place on the Record Date.

(4) The settlement cycle closest to the stock exchange Record Date shall provide for spot trades only.

(5) No Depository Participant shall hold the relevant securities in their clearing account on the Record Date.

(6) No broker or dealer shall hold the relevant securities in the clearing account on the Record Date.

(7) During the issue of rights or bonus shares, the issuer shall request in writing to deposit their Depository accounts (ID accounts) with the issuer within a specified time for all shareholders whose Depository accounts are not known to the issuer. However, if the Depository account of any shareholder is not received by the issuer within the specified time, the issuer may keep it in an open temporary account (Open Account) until the shareholder provides the Depository account.

(8) In the case of rights or bonus issues, one full share shall be included in the Depository account of the respective shareholder. However, in the case of a fraction of a security (less than 1, such as 0.75 or 0.25, etc.), all fractions shall be aggregated and included in the Depository account opened in the name of the Company Secretary as a full number of shares, and the proceeds of such securities sold on the stock exchange, after deducting expenses, shall be distributed proportionally among the respective shareholders (within the limit of dividend payment).].

47. Distribution of Dividends.- Upon request by the issuer, the warrants of the declared dividends may be distributed through the Depository. However, in that case, the responsibility for timely distribution of dividends and reporting to the Commission after the distribution of dividends shall remain with the issuer as usual.

Chapter Eight
Miscellaneous

1
[48. Compliance with orders or instructions.- Orders or instructions issued from time to time by the Commission under these Regulations and the compliance rules mentioned in these Regulations shall be considered as orders or instructions and compliance rules issued under the Depository Act, 1999.

2
[48A. Fees for services provided by Depository.- The Depository may collect fees listed in Schedule-'4' for the services provided by it: Provided that, if any other charges [such as cost reimbursement (Cost Reimbursement), deposits (Deposits), etc.] are to be collected, they shall be prescribed by the sub-rules.

3
[48B. Payment of fees, etc., to the Commission.- Various fees, etc., payable to the Bangladesh Securities and Exchange Commission may be paid by pay-order, bank draft, or electronic fund transfer.]

49. Inspection for the general public.- The Depository shall keep ready the following information, documents, etc., for public inspection during the working hours of the Depository office, namely: -

(a) List of eligible securities;
(b) Name, address, and telephone number of Depository Participants;

1 Notification No. SECI/CMMRCID/2001-63/Admin-01/27, dated 20 July 2006, replaced, published in the Bangladesh Gazette on September 27, 2006.
2 Notification No. SECI/CMMRCID/2001-63/Admin-01/27, dated 20 July 2006, renumbered, published in the Bangladesh Gazette on September 27, 2006.
3 Notification No. BSECI/CMMRC/2019-392/26/Admin/126 dated 30 June 2021 inserted, published in the Bangladesh Gazette on August 22, 2021.

(c) Depository Act, Depository Regulations, sub-rules, manuals, etc.; (d) Depository Register; and (e) Any other information, documents, etc., specified by the Commission.

50. Complaints and resolution.- The Depository shall properly record all complaints filed before it and take immediate and appropriate measures to resolve the complaints.

51. Submission of reports to the Commission.- (1) The Depository shall submit the following reports to the Commission, among others, namely: -

(a) Details of transfer of ownership of securities on the stock exchange other than on the previous business day - within the next business day; (b) Details of non-settlement of transactions on the stock exchange due to the transferor not having securities in their account on the previous business day - within the next business day; (c) Details of any disciplinary action taken against any participant - within the next three business days; (d) Report regarding immediate notification of any system failure; and (e) Half-yearly reports of the Depository - within the next one month, and annual financial details - within the next three months.

(2) If the Commission demands any other information from time to time, the Depository shall be obliged to provide it according to the Commission's instructions.

52. Rights and responsibilities of Depository and others.- The rights and responsibilities of the Depository, Depository Participants, Issuers, and agents of Issuers shall be determined through legal agreements concluded between the Depository Act, Depository Regulations along with these Regulations, the Depository's sub-rules, and relevant parts: Provided that, in case any problem arises in this regard, the decision of the Commission given in this matter shall be considered final.

1
[53. Penalty.- The Commission may, in addition to the penalties prescribed by law, take disciplinary measures such as cancelling or suspending the operation of the relevant registration certificate for violation of any provision of these Regulations or any instruction issued thereunder, or for violation of the Code of Conduct specified in Schedule-5 or any provision of the sub-rules against the person under investigation by the Commission:

Provided that, no disciplinary measure shall be taken against the relevant person without providing an opportunity of hearing along with a statement of reasons:

Further provided that, the aggrieved person may appeal against the decision of the Commission to the Commission under the Securities and Exchange Commission (Appeal) Regulations, 1995, which shall be decided according to the said Regulations.

Further provided that, if the registration certificate of any Depository Participant is suspended or cancelled by the Commission, the Depository shall immediately disconnect the connection with the participant upon receipt of the order to this effect. If a Depository Participant whose registration certificate is suspended or cancelled is a member of any stock exchange, in that case, the said stock exchange, and in other cases, the Depository, shall take action to transfer the securities kept in various Depository accounts of investors to another participant through an open link (Open Link) for the purpose of transfer.]

1 Notification No. SECI/CMMRCID/2001-63/189/Admin/70, dated 4 August 2016, replaced, published in the Bangladesh Gazette on 24 September 2016.

54. Publication of English translation as authoritative.- After the enactment of these Regulations, the Commission shall publish an authoritative text of the English translation of these Regulations by notification in the Bangladesh Gazette, which shall be known as the Authoritative English Text (অনুমোদিত ইংরেজী পাঠ): Provided that, in case of conflict between these Regulations and the said English text, these Regulations shall prevail.

Schedule-1
[Rule 27, sub-rule (2)]
Application for Registration as Depository Participant [If the applicant is a statutory institution, bank, insurance company, stock dealer, or stock broker, only providing the information mentioned in serial numbers 1 to 7 shall suffice.]

1. Name of the applicant:
2. Address of the applicant:
   [If the address changes, it shall be informed in writing to the relevant Depository and Commission within three business days]
3. The Depository in which the applicant wishes to become a participant-
   (a) Name and address:
   (b) Code No.:
   (c) Date of code issuance:
4. Class of service for which the applicant is applying for certificate: ------Participant
5. Legal status of the applicant: Company/Statutory Institution
   (Cross out the inapplicable one. If a statutory institution, bank, or insurance company, attach a certified copy of the relevant Act/Registration Certificate and audited annual statement).
6. Signatory of the applicant:
   Name of the person and description of power granted (DO NOT submit a copy of the power of attorney).
7. Applicant's
   (a) Office phone, fax:
   and email number-
   (b) Principal Executive:
   Home phone, fax, email number:
8. If the applicant is a company, details of:
   Names, addresses of directors, and details of any other companies/institutions where ownership or business relationships exist
9. Applicant's experience in securities business (if any):
10. Net capital position of the applicant (as on.........date):
    [DO NOT submit audited financial statements]
11. Is the applicant a merchant banker, portfolio manager, trustee of a mutual fund, custodian, or asset management company?
12. Has any member of the applicant or its board of directors ever been convicted of any criminal offense involving fraud, deceit, or dishonesty? If so, when, where, and for what offense?
13. Has any member of the applicant or its board of directors ever been declared bankrupt or insolvent by a court? If so, when, where?
14. Is the applicant or any member of its board of directors a defaulter of any bank loan? If so, which bank and how much money?
15. Of the authorized representative of the applicant (if any) -
    (a) Name
    (b) Father's name
    (c) Permanent address
    (d) Current address
    (e) Office address
    (f) Educational qualification
16. Number of employees of the applicant:
17. Other information:
    I hereby declare that the information provided above is true and correct to the best of my knowledge and belief.
    ...................For and on behalf of-
    Date..........................
    ...................................
    Signature and Seal of the Applicant
    Recommendation/Comment of the Depository
    Date:.............................. ..............................................
    Signature and Seal of the Principal Executive Officer

Schedule-2
[Rule 30, sub-rule (1)]
Registration Certificate of Depository Participant Securities and Exchange Commission Registration Certificate of Depository Participant
Registration Certificate No. .............. Date of Issuance of Certificate.......................
In accordance with Rule 30 of the Depository (Operational) Regulations, 2003, the Securities and Exchange Commission hereby grants this Registration Certificate to ...................................... (Name) ..................................... Address ................................... to work as a registered...................... Participant of (Name of Depository). This Registration Certificate shall remain valid until ......................... Date and thereafter it may be renewed in the specified format provided at the back of this certificate. For and on behalf of the Securities and Exchange Commission:
(Signature of the Issuing Officer)
Name: .............................
Designation: .............................
Seal
Renewal of Certificate
Registration Certificate No........................... Date...........................
Valid Until
Renewed
Changed Address,
Legal Status, etc.
(Applicable if any)
Signature and Seal of the Renewing Officer

Schedule-3
[Rule 30, sub-rule (6)]
Renewal of Registration Certificate of Depository Participant Application for Renewal of Registration Certificate of Depository Participant

1. Name and Class of Participant:
2. Registration Certificate No.:
3. Date of Issuance, Last Renewal
   and Expiry Date:
4. Changed Address (if any):
   (a) Permanent
   (b) Current
   (c) Office
   (d) Telephone, Fax, Email Number
5. Brief description of any structural or legal changes in the characteristics of the Participant's institution:
   (If any changes have occurred, they shall be informed in writing to the relevant Depository and Commission within three business days along with a copy of the change).
   I hereby declare that the information provided above is true to the best of my knowledge and belief.
   ....................For and on behalf of-
   Date:.................... ..........................
   Signature and Seal of the Applicant
   Recommendation of the Depository:
   It is hereby certified that .................................................. (Name),
   Address..................................................................... is a .........................................
   Participant of this Depository.
   The Securities and Exchange Commission has recommended the renewal of his/her Registration Certificate........................... until the date...........................
   Date:......................... ...............................................
   (Signature and Seal of the Principal Executive Officer)

1
[Schedule-4
[Rule 48]
Fees for Services Provided by Depository
Serial No.
Fee Head
Fee Rate
Minimum Fee
(Taka)
Basis for Fee Determination
When Payable

1. Consolidation (Consolidation) Fee
   5.00
   Nominal Value of Securities
   Participant
   End of Month
   (a) Equity Securities/Close-End Mutual Fund
   Taka 0.000.15
   (b) ETF Taka
   0.000075
   (c) Open-End Mutual Fund
   Taka 0.000075
   (d) Corporate Bond/Debenture and other Fixed-Income Securities Taka 0.000075 (e) Government Securities Taka 0.00 (f) Small-Cap Platform Listed Securities Taka 0.000030

1 Notification No.-SECI/CMMRCID/2001-63/189/Admin/70, dated 4 August 2016, replaced, published in the Bangladesh Gazette on 24 September 2016.

Serial No.
Fee Head
Fee Rate
Minimum Fee
(Taka)
Basis for Fee Determination
When Payable
2. Transaction (Transaction) Fee
(a) Equity Securities/Close-End Mutual Fund
Taka 0.000125
Taka 0.000075
(In the case of transactions by Market Maker)
------- Market Value Participant/
Account Holder
End of Month
(b) ETF Taka 0.000125
(In the case of secondary market ETF unit transactions, except API) Market Value Participant/ Only Buyer (Account Holder) Investor) Same Taka 0.00 (In the case of creation and redemption of units by API's own account) Taka 0.00 (In the case of transfer or settlement of underlying securities of ETF units by API's own account) Taka 0.00 (In the case of transfer of underlying securities of ETF units by API as client's account during fund formation) Net Asset Value

Serial No.
Fee Head
Fee Rate
Minimum Fee
(Taka)
Basis for Fee Determination
When Payable
Taka 0.000125 (In the case of creation of units by API as client's account) Taka 0.00 (In the case of redemption of units by API as client's account) Taka 0.00 (In the case of transfer of underlying securities of ETF units by API as client's account) Taka 0.00 (In the case of transactions by Market Maker) (c) Open-End Mutual Fund Taka 0.000125 (Only in the case of purchase, not in the case of surrender) ---- Nominal Value Participant/ Only Buyer (Account Holder) End of Month (d) Corporate Bond/Debenture and other Fixed-Income Securities Taka 25.00 ----- Per Transaction Participant/ Account Holder Same (e) Government Securities Taka 10.00 ----- Per Transaction Participant/ Account Holder Same (f) Small-Cap Platform Listed Securities Taka 0.00003 Taka 0.00 (In the case of transactions by Market Maker) ---- Market Value Participant/ Account Holder Same

Serial No. | Fee Head | Fee Rate | Minimum Fee (BDT) | Basis for Fee Determination | Payee | When Payable --- | --- | --- | --- | --- | --- | ---
3. | External Audit Fee | Depository (BO) Account Annual Audit Fee | 450/- BDT, of which Depository (BO) Account pays 250/- BDT rate to Depository Commission. Of the said 250/- BDT, 200/- BDT shall be deposited into the Government Treasury. From the remaining 200/- BDT, Depository Participant pays 100/- BDT and Depository Participant pays 100/- BDT. | ---- | Participant | Accountant/Merged (Combined) Account | Every itemized use of the account | Annual Advance (For payment of Annual Audit Fee, Depository Participant or Depository shall close accounts with no securities. If any account has securities, the Depository Participant or Depository shall suspend (freeze) the account until the fee (including any additional fee, if applicable) is paid.)
4. | Depository Connection Fee | Monthly | 500.00 BDT | ---- | First Connection | Monthly Fixed Fee | Participant/Issuer | Monthly Advance
5. | Depository Additional Connection Fee | Monthly | 5000.00 BDT | ---- | For each Additional Connection | Monthly Fixed Fee | Same | Same

Serial No. | Fee Head | Fee Rate | Minimum Fee (BDT) | Basis for Fee Determination | Payee | When Payable --- | --- | --- | --- | --- | --- | ---
6. | Annual Fee on Nominal Value (Face Value) of Issued Eligible Securities: (BDT)
Up to 5 Crore BDT
Above 5 Crore BDT up to 20 Crore BDT
Above 20 Crore BDT | ---- | ---- | ---- | For each Eligible Security | Annual Fixed Fee | Issuer | Annual Advance (a) Equity Securities/Close-End Mutual Fund | 25,000.00 | 50,000.00 | 1,00,000.00 | (b) ETF | ---- | ---- | 40,000.00 | (c) Open-End Mutual Fund | ---- | ---- | 20,000.00 | 40,000.00 | (d) Corporate Bond/Debenture and other Fixed-Income Securities | 5,000.00 | 10,000.00 | 20,000.00 | (e) Government Securities | 5,000.00 | ---- | ---- | (f) Small-Cap Platform Listed Securities | 5,000.00 | 10,000.00 | 20,000.00 |
7. | New Issue/IPO Fee | 0.00015 BDT | ---- | Issue Value | Issuer | With Application/End of Month
8. | Re-registration Fee | 0.10 BDT | 100.00 BDT | Per Security | Participant/Direct Account Holder | End of Month
9. | Documentary Fee | 2,500.00 BDT | ---- | One-time, Fixed | Participant/Issuer | At Account Opening
10. | Statement Application Fee/Statement Verification Fee
(a) 5.00 BDT per page for Hard Copy
(b) Fee Free for Soft Copy | ---- | ---- | Per Page | Account Holder | With Application
11. | SMS Notification Fee for Instant Debit/Credit of Securities from Depository BO Account | Free | Regular | Explanation: The "Government Securities" mentioned in this schedule refers to Government Securities Act, 1969 (Government Securities Act No. XX of 1969) Section 2, Sub-section (1), Clause (e).

1
[Schedule-5
[Rule-53]
Code of Conduct for Depository Participants

1. Integrity, Efficiency, etc. - Every Depository Participant shall maintain reputation, efficiency, trustworthiness and integrity in conducting its business and related activities.
2. Duty towards Clients.-(1) Every Depository Participant shall act only on the written instructions of its clients in accordance with the provisions of sub-rule.
   (2) Every Depository Participant shall provide account statements to its clients within the specified period.
   (3) Every Depository Participant is responsible for the proper preservation of its clients' securities and shall be liable to compensate the client if the securities are properly preserved but misused.
3. Responsibility towards Commission. - Every Depository Participant shall submit all books, registers, reports, documents or other papers in accordance with the instructions of the Commission or any officer authorized by it, provide all kinds of cooperation to the investigator or inspector in the matter of investigation or inspection, and shall not submit any false or misleading information or documents in such matters.
4. Reporting Suspicious Activities. - Every Depository Participant shall immediately inform the Depository and Commission in writing upon coming across any suspicious activity.
5. Resolution of Complaints. - If any client makes a written complaint to the Depository Participant, it shall be resolved immediately.]
   Securities and Exchange Commission
   Monir Uddin Ahmed
   Chairman

1 Inserted by Notification No. SECMRRCDI/2001-63/Admin-01/27, dated July 20, 2006, which was published in the Bangladesh Gazette on September 27, 2006.