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Banking units may undertake permissible transactions through an Electronic Trading Platform that is not a company incorporated in India. Banking units may also use the services of third-party voice brokers for permissible transactions. Banking units assess, document, and mitigate risks before using an Electronic Trading Platform or voice broker. Banking units report the names of Electronic Trading Platforms and voice brokers, along with the business volume in USD, to the Authority at the end of each quarter. This reporting requirement starts with the quarter ending March 31, 2021. The circular comes into force with immediate effect on February 2, 2021.
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International Financial Services Centres Authority
F.No.201/IFSCA/ETP/2020-21/
February 2, 2021
To,
All Banking Units
Dear Sir/Madam,
IFSC (Banking) Regulations, 2020 – Directions for implementation – Use of Electronic Trading Platforms (ETP) and Brokers
Banking units (BUs) may please refer to the Annex to the circular on “IFSC (Banking) Regulation, 2020 – Directions for implementation” dated December 4, 2020 issued by the Authority. The said circular, inter alia, adopted the “Electronic Trading Platforms (Reserve Bank) Directions, 2018” (the direction) dated October 5,2018 to be applicable to be BUs.
In partial modification of the above, the Authority hereby allows BUs to undertake permissible transactions through an Electronic Trading Platform (ETP) without the need for such ETP to be a company incorporated in India.
BUs may also undertake permissible transactions by using the services of third-party voice brokers.
BUs are also advised that prior to undertaking transactions on an ETP or through a voice broker they must assess document and appropriately mitigate any risk arising from undertaking transactions on such ETP or through a voice broker.
Starting with the quarter ending March 31,2021, BUs shall report to the Authority, at the end of each quarter, the names of the ETPs and third-party voice brokers through whom they have undertaken permissible transactions during the quarter along with the volume of business (in USD) conducted with through each ETP and/or voice broker.
This circular shall come into force with immediate effect.
BUs are directed to ensure compliance to the directions of this circular.
Yours faithfully
(R. Kumar) Head, Banking Division rag.kumar@ifsca.gov.in
