Upload KYC details of new clients to registering agencies: Forward Markets Commission

NEW DELHI: The Forward Markets Commission has made it mandatory for members of commodity bourses to upload KYC details of new clients from July 1 to the KYC Registering Agencies that are enlisted with Sebi.

It has also been made mandatory for members to carry out in-person verification of all new clients.

Besides, members have been directed to upload the KYC details and documents of all existing trading clients by December 1, 2015 on KYC Registering Agencies (KRAs). Till then such clients can continue to trade with their members as per their the existing KYC, FMC said.

Issuing fresh norms for implementing the uniform client registration through the facilities of KRAs in commodity markets, it said that utilisation of services of KRAs will prevent duplication and inconvenience caused to the clients while trading through various intermediaries.

"This will ensure centralised location and maintenance of KYC records of all the clients in the commodity derivatives market, which will also enable a single point KYC data management," it said.

The Securities and Exchange Board of India has permitted other financial regulators to avail the services of KRAs, it added.

As per new norms, all members of commodity markets have been asked to register with any one or more KRAs.

In order to enable members to familiarise themselves with the new KYC process, the KRA services would be made available to members for uploading/downloading details for all new client accounts opened from April 1, 2015 on optional basis.

"However, from July 1, 2015 it shall be mandatory for all members to upload the KYC details on the KRA system/server for all the new client accounts opened, if the KYC does not exist in the KRA system. The registration of clients from July 1, 2015 can be done only through the KRA system," it said.

FMC said that a new client can be allowed to start trading/dealing in commodity futures on the exchange platforms through a member as soon as the client is registered by completing the necessary KYC documentation process.

However, the member would be under obligation to upload KYC details with proper authentication on the system of the KRA within 10 days of receipt of the KYC documents from the client, it said.

FMC, however, cautioned that members should not use the KYC data of a client obtained from the KRA for purposes other than it is meant for nor should it make any commercial gain by sharing the same with any third party including its affiliates or associate.