What changed
Standalone Primary Dealers (SPDs) are now formally included as Authorised Dealers Category-III under the Master Direction, with specific compliance requirements. Reporting directions for OTC foreign exchange and foreign currency interest rate derivative contracts to CCIL's Trade Repository have been updated, including format, mode, and timelines.
What it means for you
Banks and SPDs must align their derivative operations with the revised Master Direction, ensuring SPDs follow applicable RBI directions. The updated reporting framework enhances transparency and regulatory oversight of OTC derivatives, requiring systems to meet new reporting standards.
What you must do
- Review Annex I and II of the circular to understand specific amendments for SPDs and reporting changes.
- Update internal policies and systems to reflect SPDs as Authorised Dealers Category-III under FEMA.
- Ensure OTC derivative reporting to CCIL's Trade Repository complies with revised format, mode, and timelines.
- Train relevant staff on the updated Master Direction, especially for SPD-related provisions.
- Verify that all prior circulars listed in Appendix III are superseded and no longer applied.
Who it affects
Authorised Dealer Category-I banks, Standalone Primary Dealers (SPDs), Clearing Corporation of India Ltd. (CCIL)
What is the key change for Standalone Primary Dealers (SPDs)?
SPDs are now explicitly authorized as Authorised Dealers Category-III under FEMA, and must comply with the Master Direction on Risk Management and Inter-Bank Dealings, along with their specific Master Direction from 2016.
Are there any new reporting requirements for OTC derivatives?
Yes, directions for reporting OTC foreign exchange and foreign currency interest rate derivative contracts to CCIL's Trade Repository have been updated, including changes to format, mode, and timelines as per Annex II.
When do these changes take effect?
The amendments are effective immediately from May 3, 2024, and supersede earlier circulars listed in Appendix III of the Master Direction.