Ad Astra


Ad Astra, a 2019 science fiction drama movie directed by James Grey and starring Brad Pitt, Tommy Lee Jones, Liv Tylor, Donald Sutherland among others. It is more of a psychological drama movie rather than pure technology although there is a lot of science frontiers being broken down as shown in the movie, for eg. colonies in moon, Mars and space travel to Saturn, Jupiter & Neptune. Brad Pitt (Roy McBride) is the son of Clifford McBride (Tommy Lee Jones) who has gone away to space for 30 years in search of intelligent life on the universe, in the process he has travelled to Saturn, Jupiter and now stationed near Neptune. His space station has created some cosmic ray disturbances which has affected Earth also, so the son sets out to locate his dad in the vast universe, which takes 79 days from Mars itself. Lot of emotional tug of war between father and the son later, earth is safe from the cosmic disturbances and the power surges. The movie drags a bit in the middle especially when Brad is about to reach Neptune to find his dad after 3 decades. There is no emotional re-union sort of, the Dad has more or less lost his contact and interest in Earth. The movie was nominated to the Oscars in the sound mixing category. The special effects in the movie is quite extraordinary, it is in the human connect that the movie finds its weak spot. 

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RFQ platform


https://www.irdai.gov.in/ADMINCMS/cms/Circulars_Layout.aspx?page=PageNo4252

Implementing RFQ platform for Investments in Corporate Bonds / Commercial Papers

1.      With a view to enhance and coalescing the fragmented liquidity in Corporate Bonds, SEBI has implemented Request for Quote (RFQ) Platform through Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). The RFQ platform seeks to replicate the OTC market albeit on an electronic platform in a move to bring more transparency, centralization in protecting investor interest apart from having enough liquidity in Secondary Market.

2.     To achieve the above, SEBI, vide Circular: SEBI/HO/IMD/DF3/CIR/P/2020/130 Dated 22nd July, 2020 has mandated all Mutual Funds (MFs) to undertake 10% of their total Secondary Market trades of Corporates Bonds through RFQ to start with. As this is likely to bring transparency and liquidity in the Corporate Bond segment, the Authority, in consultation with the Life and General Insurance Councils directs all Insurers as follows:

a.     On monthly basis, the Insurers shall undertake at least 10% of their total Secondary Market trades in the Corporate Bonds in Value place / seek Quotes through one-to-many mode on RFQ platform available on BSE/NSE. The 10% limit shall be reckoned on the average of Secondary Market Trades by Value, in the immediately preceding 3 months on rolling basis.

b.     Concurrent Auditor of the Insurer in his Quarterly Audit Report shall confirm that the Insurer has complied with the directions of this Circular.

3.     The above procedure will be followed by all Insurers with effect from 1st Nov, 2020.

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systemically important insurers


https://www.irdai.gov.in/ADMINCMS/cms/frmGeneral_Layout.aspx?page=PageNo4251

1.      Domestic Systemically Important Insurers (D-SIIs) refer to insurers of such size, market importance and domestic and global inter connectedness whose distress or failure would cause a significant dislocation in the domestic financial system. Therefore, the continued functioning of D-SIIs is critical for the uninterrupted availability of insurance services to the national economy.

2.      D-SIIs are perceived as insurers that are ‘too big or too important to fail’ (TBTF). This perception and the perceived expectation of government support may amplify risk taking, reduce market discipline, create competitive distortions, and increase the possibility of distress in future. These considerations require that D-SIIs should be subjected to additional regulatory measures to deal with the systemic risks and moral hazard issues.

3.      In order to identify such insurers and to put such insurers to enhanced monitoring mechanism, the Insurance Regulatory and Development Authority of India (IRDAI) has developed a methodology for identification and supervision of D-SIIs. The parameters, as per the methodology for identification of D-SIIs, inter alia include the following:

a.            the size of operations in terms of total revenue, including premium underwritten and the value of assets under management;

b.            global activities across more than one jurisdiction;

c.             lack of substitutability of their products and/or operations; and

d.            interconnectedness through counterparty exposure and macro-economic exposure.

These parameters were assigned weights to cover various aspects of their operations. The Authority would identify D-SIIs on an annual basis and disclose the names of these insurers for public information.

4.      After analysis of data, the Authority has identified for the year 2020-21, the following insurers as D-SIIs:

a.    Life Insurance Corporation of India;

b.    General Insurance Corporation of India; and

c.     The New India Assurance Co. Ltd.

5.      Given the nature of their operations and the systemic importance of the D-SIIs, these insurers have been asked to carry out the following:

(i)         Raise the level of corporate governance;

(ii)       identify all relevant risk and promote a sound risk management culture.

6.      D-SIIs will also be subjected to enhanced regulatory supervision.

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positive pay system


Please refer to the Statement on Developmental and Regulatory Policies dated August 6, 2020 wherein Reserve Bank of India (RBI) had announced introduction of Positive Pay System for Cheque Truncation System (CTS).

2. The concept of Positive Pay involves a process of reconfirming key details of large value cheques. Under this process, the issuer of the cheque submits electronically, through channels like SMS, mobile app, internet banking, ATM, etc., certain minimum details of that cheque (like date, name of the beneficiary / payee, amount, etc.) to the drawee bank, details of which are cross checked with the presented cheque by CTS. Any discrepancy is flagged by CTS to the drawee bank and presenting bank, who would take redressal measures.

3. National Payments Corporation of India (NPCI) shall develop the facility of Positive Pay in CTS and make it available to participant banks. Banks, in turn, shall enable it for all account holders issuing cheques for amounts of ₹50,000 and above. While availing of this facility is at the discretion of the account holder, banks may consider making it mandatory in case of cheques for amounts of ₹5,00,000 and above.

4. Only those cheques which are compliant with above instructions will be accepted under dispute resolution mechanism at the CTS grids. Member banks may implement similar arrangements for cheques cleared / collected outside CTS as well.

5. Banks are advised to create adequate awareness among their customers on features of Positive Pay System through SMS alerts, display in branches, ATMs as well as through their web-site and internet banking.

6. Positive Pay System shall be implemented from January 01, 2021.

7. This directive is issued under Section 10 (2) read with Section 18 of Payment and Settlement Systems Act, 2007 (Act 51 of 2007).

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national medical commission


https://www.pib.gov.in/PressReleasePage.aspx?PRID=1659029

Historic reform in the field of medical education has been effectedby the Union Government with the constitution of the National Medical Commission (NMC), along with four Autonomous Boards. With this, the decades old institution of the Medical Council of India (MCI) stands abolished. Along with NMC, the four Autonomous Boards ofUG and PG Medical Education Boards, Medical Assessment and Rating Board, and Ethics and Medical Registration Board have also been constituted to help the NMC in day to day functioning.

This historic reform will steer medical education towards a transparent, qualitative and accountable system. The basic change that has happened is that the Regulator is now ‘selected’ on merits, as opposed to an ‘elected’ Regulator. Men and Women with impeccable integrity, professionalism, experience and stature have been now placed at the helm to steer the medical education reforms further.

The Notifications in this regard were issued late last night on the 24th September, 2020.

Dr S C Sharma (retd. Prof, ENT, AIIMS, Delhi) has been selected as the Chairperson for a period of three years. Besides the Chairperson, NMC will have 10 ex-officio members that include Presidents of the four Autonomous Boards, Dr.Jagat Ram, Director PGIMER, Chandigarh, Dr RajendraABadwe, Tata Memorial Hospital, Mumbai and Dr SurekhaKishore, Executive Director, AIIMS, Gorakhpur. In addition, NMC will have 10 nominees from Vice Chancellors of Health Universities from States/UTs, 9 nominees from State Medical Councils, and three expert members from diverse professions. Dr SmitaKolhe, a renowned social worker working in tribal Melaghat area of Maharashtra and ShriSantosh Kumar Kraleti, CEO, Foot Soldiers for Health Pvt Ltd have been nominated as these expert members. Dr R K Vats will head the Secretariat as Secretary of the NMC.

In addition to NMC, four Autonomous Boards have also been constituted and come into effect from today. The … Board will be chaired by ….. and will have …..The Commission has four Autonomous Boards, namelyUnder-Graduate Medical Education Board, Post-Graduate Medical Education Board, Medical Assessment and Rating Board andEthics and Medical Registration Board to oversee UG/ PG education, accreditationand assessment and the matters related to ethics and professional conduct of doctors.

The NMC will carry forward the reforms initiated by the Board of Governors under Dr V K Paul. Already, number of MBBS seats has increased over the last six years by 48% from around 54000 in 2014 to 80,000 in 2020. The PG seats have increased by 79% from 24000 to 54000 in the same duration.

The key functions of the NMC will be further streamlining regulations, rating of institutions, HR assessment, focus on research. Besides they will work on modalities of the common final year exam after MBBS (NEXT- National Exit Test) to serve for both registration and PG entrance; prepare guidelines for fee regulation by private medical colleges; and developing standards for Community Health Providers to serve in primary healthcare with limited practicing licence.

It may be recalled that the National Medical Commission Act, 2019 was passed by the Parliament in August, 2019.

With the coming into effect of the NMC Act from 25th September, 2020, the Indian Medical Council Act, 1956 stands repealed and the Board of Governors appointed in supersession of Medical Council of India has also been dissolved with effect from the said date.

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faceless assessment


https://www.pib.gov.in/PressReleasePage.aspx?PRID=1658982

The Income Tax Department today launched Faceless Income Tax Appeals. Under Faceless Appeals, all Income Tax appeals will be finalised in a faceless manner under the faceless ecosystem with the exception of appeals relating to serious frauds, major tax evasion, sensitive & search matters, International tax and Black Money Act. Necessary Gazette notification has also been issued today.

It may be noted that Hon’ble PM on 13thAugust, 2020 while launching the Faceless Assessment and Taxpayers’ Charter as part of “Transparent Taxation – Honoring the Honest” platform, had announced launching of Faceless Appeals on 25th September, 2020 on the birth anniversary of Pt. Deen Dayal Upadhayay. Also, in recent years the Income Tax Department has carried out several reforms in Direct Taxes for the simplification of tax processes and for ease of compliance for the taxpayers.

Under the Faceless Appeals, from now on, in income tax appeals, everything from e-allocation of appeal, e-communication of notice/ questionnaire, e-verification/e-enquiry to e-hearing and finally e-communication of the appellate order, the entire process of appeals will be online, dispensing with the need for any physical interface between the appellant and the Department. There will be no physical interface between the taxpayers or their counsel/s and the Income Tax Department. The taxpayers can make submissions from the comfort of their home and save their time and resources.

The Faceless Appeals system will include allocation of cases through Data Analytics and AI under the dynamic jurisdiction with central issuance of notices which would be having Document Identification Number (DIN). As part of dynamic jurisdiction, the draft appellate order will be prepared in one city and will be reviewed in some other city resulting in an objective, fair and just order. The Faceless Appeal will provide not only great convenience to the taxpayers but will also ensure just and fair appeal orders and minimise any further litigation. The new system will also be instrumental in imparting greater efficiency, transparency and accountability in the functioning of the Income Tax Department.

As per data with CBDT, as on date there is a pendency of almost 4.6 lakh appeals at the level of the Commissioner (Appeals) in the Department. Out of this, about 4.05 lakh appeals, i.e., about 88 % of the total appeals will be handled under the Faceless Appeal mechanism and almost 85% of the present strength of Commissioners (Appeals) shall be utilised for disposing off the cases under the Faceless Appeal mechanism.

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Open Water 2: Adrift


An open water adventure holiday gone horribly wrong. Open Water 2: Adrift is projected as based on true events, but with the kind of human stupidity depicted in the movie, i doubt if humans can be so stupid. Three pairs of couples go on a yatch holiday out in the open sea or ocean, far away from shore. One couple has an infant daughter also on board, which itself was a risky thing to take such a young one on a ship or a yatch cruise. Four of the members jump into the water to do a swim which i thought was another stupid thing to do, who swims in open ocean far away from land, maybe some do perhaps. Of the remaining, Amy (Susan May Pratt) has a phobia for water because of an incident in her childhood when her father drowned while swimming with her. The other guy Dan (Eric Dane) is ostensibly the owner of the yatch, but later reveals that he is a fraud and that the yatch is actually belonging to his boss. What kind of a boss allows his employee to take his yatch out to a cruise, beats me. Anyway, both of them also jump into the water, without realising that nobody has bothered to put the ladder down or keep the hatch down so that people can climb back. Dan is such an idiot that he does not realise the blunder he has committed endangering everybody’s lives. All of them are stuck down in the water with nary any hold or groove to climb back. Soon one after another start drowning. The movie advertised shark attack, but there was nothing of that sort, even though blood oozed from a couple of the guys. 

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system driven disclosures – takeover code


SEBI circular dated 23rd September, 2020 on the subject.

  1. Please refer to SEBI circular dated December 01, 2015 and December 21, 2016 pertaining to processes to be followed by Depositories, Exchanges and Registrar & Share Transfer Agents (“RTAs”) for implementation of SDD. Subsequently, SEBI vide circular dated September 09, 2020 under Regulation 7(2) SEBI (PIT) Regulations, 2015 has provided a detailed procedure for SDD implementation.
    The circular dated September 09, 2020 requires that the capture of the PAN of the entities be done from the listed company itself, rather than through the RTAs as provided in the circular dated December 01, 2015.
  2. In order to align the practices, it has been decided to use the procedure of capturing the PAN of the promoters from listed companies as mentioned in para 2,3 & 4 of the Annexure A of the circular dated September 09, 2020 for SAST disclosures too. The referred paras are quoted here for convenience: –
    “2. Listed company shall provide the information including PAN number of Promoter(s) including member(s) of the promoter group, designated person(s) and director(s) (hereinafter collectively referred to as entities) as per PIT Regulations to the designated depository (selected in terms of SEBI circular ref. no. SEBI/HO/CFD/DCR1/CIR/P/2018/85 dated May 28, 2018) in the format and manner prescribed by the Depositories. For PAN exempt entities, the Investor’s Demat account number(s) shall be specified by the listed company. The information shall be provided within 10 days from the date of this circular.
  3. The designated depository shall share the information received from the listed company with other depository.
  4. In case of any subsequent update in the details of the entities, the listed company shall update the information with the designated depository on the same day. The designated depository shall share the incremental changes with the other depository on the day of receipt from the listed company.”
  5. The other requirements of SEBI circular dated December 01, 2015 on the subject shall remain in force.
  6. https://www.sebi.gov.in/legal/circulars/sep-2020/system-driven-disclosures-sdd-under-sebi-sast-regulations-2011_47632.html

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no insolvency cases.


Vide an amendment to the Insolvency and Bankruptcy Code, government had stayed all insolvency proceedings in respect of defaults occurring after 25th March, 2020 by a period of six months i.e upto 24th September, 2020.

This is due to the covid pandemic and in order to protect the companies during this dire period.

Now vide another notification issued yesterday, i.e. 24th September, this period has been extended by another 3 months i.e. upto 24th December, 2020.

Copy of the notification is available at the IBBI site.

https://www.ibbi.gov.in/

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The General


Buster Keaton and his rip roaring comedy in The General (1926) one of the finest silent era comedy films of all time. Johnny Gray (Buster Keaton) is a train engineer and loves his engine and his lady love Annabelle (Marion Mack). When war breaks out, time comes to enlist for the Confederates, but he is rejected and his lady love also rejects him without an uniform. In the meanwhile, the Confederates are infiltrated by some spies who steal his train and make off with the supplies. Off goes Johnny after the train and some delightful comic scenes follows. Annabelle is meanwhile kept as captive by the Union soldiers and then Johnny has to rescue her, so some more delectable comic scenes. Buster Keaton’s comic timings were superb in the movie somewhat reminiscent of Charlie Chaplin. Fight ensues between Union and Confederate soldiers much to the relief and joy of the Confederates. Brilliant movie to watch especially for Buster Keaton. The direction and camera work were quite superb for that era, especially shots of the moving trains and the wilderness. Who knew a silent movie would prove to be so powerfully comic. Brilliant. 

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guidelines for investment advisors


SEBI circular dated 23rd September, 2020 on the subject.

  1. Securities and Exchange Board of India (SEBI), after considering the inputs from public consultation, reviewed the framework for regulation of Investment Advisers (IA) and notified Securities and Exchange Board of India (Investment Advisers) (Amendment) Regulations, 2020 (hereinafter referred as “amended IA Regulations”) on July 03, 2020. These amendments shall come into force on September 30, 2020.
  2. In addition to the above, Investment Advisers shall ensure compliance with the following guidelines:
    (i) Client Level Segregation of Advisory and Distribution Activities
    To ensure client level segregation at Investment Adviser’s group/family1
    level, as per Regulation 22 (5) of amended IA Regulations, following compliance and monitoring process shall be adopted:
    a. Existing clients, who wish to take advisory services, will not be eligible for availing distribution services within the group/family of IA. Similarly, existing clients who wish to take distribution services will not be eligible for availing advisory services within the group/family of IA.
    b. A new client will be eligible to avail either advisory or distribution services within the group/family of IA. However, the option to avail either advisory services or distribution services shall be made available to such client at the time of on boarding.
    c. Client under these guidelines shall include individual client or non-individual client.
    d. The client shall have discretion to continue holding assets prior to the
    applicability of this segregation under the existing advisory/distribution

“Group” and “family of an individual investment adviser” shall be as per Regulation 22 (3) (iii) and Regulation 2(gc) respectively of the amended IA regulations arrangement. However, the client shall not be forced to liquidate/switch such existing holdings.
e. PAN of each client shall be the control record for identification and client level segregation.
f. In case of an individual client, “family of client” shall be reckoned as a single client and PAN of all members in “family of client” would jointly and severally be the control record. However, the same is not applicable for non-individual clients.
g. The dependent family members shall be those members whose assets on
which investment advisory is sought/provided, originate from income of a
single entity i.e. earning individual client in the family. The client shall provide an annual declaration or periodic updation as the case maybe in respect of such dependent family members.
h. IA shall, wherever available, advice direct plans (non-commission based) of products only.
i. The investment adviser shall maintain on record an annual certificate from an auditor (in case of individual IA) and its statutory auditor (in case of a nonindividual IA) confirming compliance with the client level segregation requirements as specified in Regulation 22 of amended IA Regulations. Such annual certificate shall be obtained within 6 months of the end of the financial year and form part of compliance audit, in terms of Regulation 19(3) of the amended IA Regulations.
(ii) Agreement between IA and the client
a. Regulation 19 (1) (d) of the amended IA Regulations provides that IA shall
enter into an investment advisory agreement with its clients. The said agreement shall mandatorily cover the terms and conditions provided in
Annexure-A.
b. IA can include additional terms and conditions in the agreement without
diluting the provisions of SEBI (Investment Advisers) Regulations, 2013 and
amendments thereto as well as circulars issued thereunder.
c. IA shall ensure that neither any investment advice is rendered nor any fee is charged until the client has signed the aforesaid agreement and provided copy of signed agreement to the client.
d. IA shall enter into investment advisory agreement with its clients including existing clients latest by April 01, 2021 and submit a report, confirming the same to SEBI latest by June 30, 2021.


“Family of client” and “AUA” shall be as per as per Regulation 2 (gb) and Regulation 2(aa) respectively of the
amended IA regulations

(iii) Fees
Regulation 15 A of the amended IA Regulations provide that Investment Advisers shall be entitled to charge fees from a client in the manner as specified by SEBI, accordingly Investment Advisers shall charge fees from the clients in either of the two modes:
(A) Assets under Advice (AUA) mode
a. The maximum fees that may be charged under this mode shall not exceed
2.5 percent of AUA per annum per client across all services offered by IA.
b. IA shall be required to demonstrate AUA with supporting documents like
demat statements, unit statements etc. of the client.
c. Any portion of AUA held by the client under any pre-existing distribution
arrangement with any entity shall be deducted from AUA for the purpose of
charging fee by the IA.
(B) Fixed fee mode
The maximum fees that may be charged under this mode shall not exceed INR 1,25,000 per annum per client across all services offered by IA.
General conditions under both modes
a. In case “family of client” is reckoned as a single client, the fee as referred
above shall be charged per “family of client”.
b. IA shall charge fees from a client under any one mode i.e. (A) or (B) on an
annual basis. The change of mode shall be effected only after 12 months of
on boarding/last change of mode.
c. If agreed by the client, IA may charge fees in advance. However, such
advance shall not exceed fees for 2 quarters.
d. In the event of pre-mature termination of the IA services in terms of
agreement, the client shall be refunded the fees for unexpired period.
However, IA may retain a maximum breakage fee of not greater than one
quarter fee.
(iv) Qualification and certification requirement
Regulation 7 of the amended IA Regulations specifies the minimum qualification and certification requirements for IAs. Further, in terms of second proviso of regulation 7 (1), existing individual IAs above fifty years of age (as on September 30,2020) shall not be required to comply with the qualification and experience requirements specified under Regulation 7(1)(a) and 7(1)(b) of the amended IA Regulations. However, such IAs shall hold NISM accredited certifications and comply with other conditions as specified under Regulation 7 (2) of the amended IA Regulations at all times.
(v) Registration as Non Individual Investment Advisor
a. As per Regulation 13(e) of the amended IA Regulations, an individual IA shall apply for registration as non-individual investment adviser on or before reaching 150 clients.
b. Such application for registration shall be made in FORM-A as per the
amended IA regulations, along with the requisite fee and same shall be
assessed in accordance with the provisions of SEBI(Investment Advisor)
Regulations, 2013 and amendments thereto as well as circulars issued
thereunder.
c. Once number of clients reaches 150 and till grant of registration as a nonindividual IA, Individual IA shall not on-board fresh clients. However, during the period of examination of application by SEBI, individual IA shall continue to service existing clients. In case the aforesaid IA does not get registration as non-individual IA,such IA shall continue the advisory activities as an Individual IA while ensuring that the numbers of clients does not exceed 150 in total.
d. As per Regulation 13(e) of the amended IA Regulations, existing Individual IA having more than 150 clients as on September 30, 2020 shall not on-board fresh clients and such Individual IA shall apply for registration as nonindividual IA latest by April 01, 2021. However, during the period of examination of application by SEBI, individual IA shall continue to service existing clients.
e. Existing Individual IA, having more than 150 clients on September 30, 2020, shall report their number of clients to SEBI through sebiria@sebi.gov.in, latest by October 15, 2020 in the following format:


(vi) Maintenance of record
Regulation 19 (1) of the SEBI (Investment Advisers) Regulations, 2013 provides that IA shall maintain records with respect to his activities as an investment adviser. In this regard, it is clarified that:
a. IA shall maintain records of interactions ,with all clients including prospective clients (prior to onboarding), where any conversation related to advice has taken place inter alia, in the form of:

i. Physical record written & signed by client,
ii. Telephone recording,
iii. Email from registered email id,
iv. Record of SMS messages,
v. Any other legally verifiable record.
b. Such records shall begin with first interaction with the client and shall continue till the completion of advisory services to the client.
c. IAs shall be required to maintain these records for a period of five years.
However, in case where dispute has been raised, such records shall be kept
till resolution of the dispute or if SEBI desires that specific records be
preserved, then such records shall be kept till further intimation from SEBI.
(vii) Audit
a. As per regulation 19 (3) of the amended IA Regulations, IA shall ensure that annual audit in respect of compliance of SEBI (Investment Advisers)
Regulations, 2013 and circulars issued thereunder is conducted. The audit
shall be completed within six months from the end of each financial year.
b. The adverse findings of the audit, if any, along with action taken thereof duly approved by the individual IA/management of the non-individual IA, shall be reported to respective SEBI office (based on the registered address of IA) within a period of one month from the date of the audit report but not later than October 31st of each year for the previous financial year starting with the financial year ending March 31,2021.
(viii) Risk profiling and suitability for non-individual clients
a. Regulation 16 and 17 of SEBI (Investment Adviser) Regulations, 2013
mandates risk profiling and suitability for all categories of clients.
b. In order to further enhance the risk profiling and encompass suitable factors in case of non-individual clients, IA shall use the investment policy as approved by board/management team of such non-individual clients for risk profiling and suitability analysis.
c. The discretion to share the investment policy/relevant excerpts of the policy shall lie with the non-individual client. However, IA shall have discretion not to onboard non-individual clients if they are unable to do risk profiling of the non-individual client in the absence of investment policy.
(ix) Display of details on website and in other communication channels
In order to protect the interest of investors and bring more transparency in the functioning of investment advisers, IAs shall display the following information prominently on its website, mobile app, printed or electronic materials, know your client forms, client agreements and other correspondences with the clients:

 Complete name of Investment Adviser as registered with SEBI,
 Type of Registration-Individual, Non-Individual,
 Registration number, validity of registration,
 Complete address with telephone numbers,
 Contact details of the Principal Officer –contact no, email id etc.,
 Corresponding SEBI regional/local office address.

  1. Applicability
    Client level segregation of advisory and distribution activities, agreement and fees to be charged are aligned together. IA shall ensure compliance with measures stated above at clause 2(i), 2(ii) and 2(iii) latest by April 01, 2021.
    Compliance with measures referred above at clause 2 (vi), 2(viii) and 2(ix) shall be ensured latest by January 01, 2021. Further timelines have been specified under clause 2(iv), 2(v) and 2(vii).

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rights issues


SEBI press release dated 23rd September, 2020 streamlining the eligibility criteria for a listed company to come out with a rights issue and truncated disclosure requirements, doing away with duplication of information, already in the public domain.

SEBI has decided to amend SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 to rationalise eligibility criteria and disclosure requirements for Rights Issues’ with an objective to make the fund raising through this route, easier, faster and cost effective.
The key amendments include:

  1. Issuer shall be eligible to make truncated disclosures in terms of Part B :
    i. where it has been filing periodic reports/ statements/ information in
    compliance with Listing Regulations as applicable, for last one year instead of last three years as required earlier.
    ii. where three years have passed after change in management pursuant to acquisition of control or Listing consequent to a scheme of arrangement.
  2. All other issuers not satisfying Part B eligibility conditions shall make disclosures in terms of new set of proposed disclosures i.e. Part B-1. Part B-1 disclosures would be more detailed than Part B, but truncated compared to Part A, which is meant for IPO/FPO offer document.
  3. Disclosure requirements under Part B have been rationalized to avoid duplication of information in letter of offer, especially the information which is already available in public domain and is disclosed by the companies in compliance with the disclosure requirements under SEBI Listing regulations.
  4. Threshold increased from Rs. 10 crores to Rs 50 crores, for filing requirement of Rights issue draft letter of offer with the Board for its observations.
  5. Mandatory 90% minimum subscription criteria for Rights Issue shall not be applicable to those issuers where object of the issue involves financing other than financing of capital expenditure for a project, provided that the promoters and promoter group of the issuer undertake to subscribe fully to their portion of rights entitlement.
  6. Issuer shall be eligible to make Fast Track Rights Issue, in case of pending showcause notices in respect to adjudication, prosecution proceedings and audit qualification, provided that necessary disclosures along with potential adverse impact on the issuer are made in the letter of offer.
  7. The amendments will be effective from the date it is notified in the Gazette.

https://www.sebi.gov.in/media/press-releases/sep-2020/rationalization-of-eligibility-criteria-and-disclosure-requirements-for-rights-issues_47638.html

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labour bills passed


https://www.pib.gov.in/PressReleasePage.aspx?PRID=1658197

The Rajya Sabha in its sitting today passed three labour codes namely, Industrial Relations Code, 2020 (ii) Code on Occupational Safety, Health & Working Conditions Code, 2020 & (iii) Social Security Code, 2020. With this, the decks for enactment of these codes have been cleared as Lok Sabha had passed these Bills yesterday.

Speaking during the discussions on the bills, Shri Gangwar described the Bills as historic game changer which will harmonize the needs of workers, industries and other related parties.  He said that these Labour Codes will prove to be an important milestone for the welfare of the workers in the country.  Shri Gangwar informed that from 2014 till now our Government has taken many steps for welfare of the workers and through these Labour Codes the dream of an overall labour reform is being realized.  He emphasized that the OSH Code envisages safe working environment for workers especially women.  The Minister added that an effective dispute resolution mechanism is being ensured through Industrial Relations Code providing for time-bound dispute resolution system in every institution.  The Minister further said that the Social Security Code provides a framework to include organized and unorganized sector workers under the ambit of comprehensive social security.  The Social Security Code contains provisions relating to EPFO, ESIC, building construction workers, maternity benefits, gratuity and social security fund for unorganized sector workers.  “Through this Code, we are moving towards fulfilling the Prime Minister’s vision of Universal Social Security”,  Shri Gangwar added.

Shri Gangwar further said that under the dynamic leadership of visionary Prime Minister Shri Narender Modi, this Government has taken number of steps to fulfill the dreams of Baba Saheb Ambedkar from 2014 onwards and gave equal importance to ‘Shramev Jayate’ and ‘Satyamev Jayate’.  My Ministry has been working tirelessly to provide social security and other welfare measures to both organized and unorganized workers including during this COVID-19 pandemic.  He added that unprecedented steps were taken by Government and launched many welfare measures such as increasing the maternity leave for our sisters from 12 weeks to 26 weeks; women were allowed to work in mines under Pradhan Mantri Rozgar Protsahan Yojana.  Formal employment was increased with portability in EPFO and welfare schemes and expansion of ESIC facilities to our fellow citizens.

Dwelling upon amalgamation 29 labour laws into four Labour Codes, Shri Gangwar said that extensive consultation was undertaken by the Government before finalizing the Labour Codes.  These include discussions in nine Tripartite Meetings, 4 sub-committees, 10 inter-ministerial consultations, Trade Unions, Employers’ Associations, State Governments, Experts, International Bodies and also invited public suggestions/comments from people by placing them in public domain for 2-3 months.

The Minister stressed that the objective of labour reforms is to have their labour laws in line with the changing world of workplace and provide an effective and transparent system, balancing the needs of workers and industries.  He further said that in this journey of 73 years of independence, the atmosphere, technological phase, mode of working and the nature of work has changed drastically in today’s new India. With this change, if India does not make the required changes in its labour laws, then we will be left behind in both the welfare of the workers and the development of industries”, Shri Gangwar said.

He emphasized that the structure of welfare and rights of Atmanirbhar Shramik is based on four pillars. Regarding First Pillar which is salary protection, the Minister said that even after 73 years of independence, and despite having 44 labour laws, only about 30 percent of India’s 50 crore workers had the legal right to minimum wages  and all the workers were not paid on time. “For the first time, our government has worked to correct this discrepancy and has given the legal right to all the 50 crore organized and unorganized sector workers to get minimum wages and timely wages”, Shri Gangwar added.

The second important pillar of labour safety, Shri Gangwr said  is to give him a safe working environment to protect his health and lead a happy life. For this, he said, for the first time in the OSH Code, annual health check-up has been provided for workers above a certain age. Additionally, to keep the standards related to safety effective and dynamic, they can be replaced with changing technology by the National Occupational Safety & Health Board.    In order to provide a safe environment, workers and employers should decide together, for this, a safety committee has been provided for in all institutions. 

He also informed the House that the OSH Code reduced the minimum qualification from 240 days to 180 days for leave. The Bill also provides for the payment of at least 50 percent of the penalty imposed on an employer for injury or death at the work place, to the aggrieved worker, in addition to other benefits. With all these provisions, an effort has been made to give workers a safe working environment.

Stating that women should have the freedom to do the same work as men, he said that for the first time, a provision has been  made that women can work in any type of institution at night as per their choice. “However, the employer will have to make all necessary security arrangements, as determined by the appropriate government”, he added

He informed that the third important pillar for workers is Comprehensive Social Security.   In line with this resolution, he said the scope of ESIC and EPFO ​​is being extended in the Social Security Code. To increase the scope of ESIC, a provision has been made that now its coverage will be in all 740 districts of the country. In addition to this, the option of ESIC will also be for plantation workers, unorganized sector workers, gigs and platform workers, and institutions with less than 10 workers. If there is a risky work in an institute,  that institute will inevitably be brought under the purview of ESIC even if it is a sole labourer. Similarly, to increase the scope of EPFO, the schedule of the institutions has been removed in the current law and now all those institutions which have 20 or more workers will come under the ambit of the EPF. Apart from this, the option of EPFO ​​for institutions with less than 20 workers and self-employed workers is also being given in the Social Security Code.

To provide social security to 40 crore unorganized sector workers, he informed, provision for “Social Security Fund” has been made. Through this fund, social security schemes will be made for workers and gigs and platform workers working in the unorganized sector and plans will be formulated to provide all kinds of social security benefits such as death insurance, accident insurance, maternity benefit and pension etc. to these 40 crore workers. “Through these efforts we have taken an important step towards fulfilling our pledge of Universal Social Security coverage”, he said.

Talking about Fourth Pillar, Shri Gangwar said that we have simplified and made effective IR Code so that peace and harmony prevail in the industrial units. On bringing Fixed Term Employment to the IR Code, engaged for a short period of their time and do not get service conditions, leave, salary, social security, gratuity etc. like regular employees, he said we have also ensured that Fixed Term Employees’ service conditions, salary, leave and social security will also be the same as a Regular Employee. In addition, Fixed Term Employee has also been given the right to pro-rata Gratuity.

Shri Gangwar also emphasized that the provisions of Strike in IR Code do not take back the right of any workers to go on strike. Prior to going on the strike, the 14-day notice period obligation has been imposed on every institution to attempt to end the dispute through amicable negotiations during this period. Neither the workers nor the industry have any benefit from the workers going on the strike”, he added.

As far as raising the threshold in Retrenchment, Closure or Lay-off in the IR Code from 100 workers to 300 workers, he pointed out that labour is the subject of concurrent list, and the concerned state governments have right to change the laws.  He informed that as many as 16 states, using this right, have already increased this limit. Parliamentary Standing Committee also recommended that this limit be increased to 300. Moreover, most of the institutes do not want to keep more than 100 workers in their institution, which promotes informal employment”, Shri Gangwar stressed.

The Minister also informed that according to the Economic Survey 2019, after increasing this Threshold from 100 to 300 in the state of Rajasthan, along with the number of large factories, there has also been an increase in employment generation of workers and an unprecedented reduction in layoffs. “This makes it clear that changing this one provision will motivate investors to set up large factories in the country, and by setting up more factories, more employment opportunities, more workers in our country will be generated for”, he opined.

Shri Gangwar also said that the Trade Unions play an important role in getting workers their rights in institutions. Recognizing the contribution, for the first time in law, Trade Unions are being recognized at the institution level, state level and center level. For the first time in the IR Code, he informed, a provision of Re-skilling Fund has been made with the objective of increasing the chances of employment again if any worker is missed. These workers will be given 15 days salary for this.

Mentioning special provisions made to strengthen the rights of migrant workers in the scenario of COVID-19, he said, the definition of migrant workers has been broadened. Now all the workers who come from one state to another state, and their salary is less than 18 thousand rupees,  they will come under the definition of migrant labour and will get the benefit of welfare schemes of the government. Apart from this, there is a provision to create a data base for migrant workers, portability of their welfare schemes, a separate help line arrangement and travel allowance to be given by the employer once a year for them to go to their place of origin.

Shri Gangwar also informed that under  various labour laws, there will be no need to have multiple registrations or multiple licenses to set up industries. “As far as possible, now we are going to arrange to provide registration, license etc. in a time bound manner and under online process”, he added.

Shri Gangwar concluded saying that through these 4 Labour Codes we are ensuring the welfare of workers on the one hand, on the other hand it is an effort to develop new industries through a simple compliance system, which will create employment for our workforce. New opportunities should be created.  “With enactment of new Labour Codes, the vision of our Prime Minister to have Sabka Sath, Sabka Vikas and Sabka Vishwas will get a big boost and India will march to the front league of developed nations”, Shri Gangwar emphasized.

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The Squaw Man


A 1914 silent era movie “The Squaw Man” directed by the great Cecil de Mille and the first western ever in Hollywood. It is one of those cult movies in the history of movies. Starring Warner Baxter as Jim, Eleanor Boardman as Diana, Lupe Velez as Naturich, its a story where an Englishman Jim has had to leave England to save his face and family name, following the swindling of the war regiment cash by his cousin Henry. Jim has to take the blame on himself and unfortunately he loves Diana who is Henry’s wife. So all sort of tangles there. He escapes to America, where he becomes a wild west man, gets into a conflict with a local goon there Cash Hawkins, who is killed by Naturich. Later Jim and Naturich marry and have a kid. In the meanwhile Henry dies in an alpine fall accident and his dying confession absolves Jim of all the wrongdoings. Diana comes to America to reunite with Jim and ask him to take his rightful place as the Earl. There is no music, unlike in Battleship Potemkin which had great orchestral music. And with no sound, and only the few notes to let us know what is going on in the movie. Cecil de Mille made a 1931 version of the same movie, but with sound and dialogues, but that version is unfortunately not available on youtube.  

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video based KYC


IRDAI circular dated 21st September, 2020 on the subject.

In order to simplify the process of Know Your Customer (KYC), it is proposed to leverage the various electronic platforms to make it customer friendly.

2.   The Insurers are hereby permitted to use the “Video Based Identification Process (VBIP)” as described below:

3.   “Video Based Identification Process (VBIP)”is an alternative (optional)electronic process of Identification / KYC in paperless form, carried out by the insurer/authorised person (person authorised by the insurer and specifically trained for face-to-face VBIP) by undertaking seamless, secure, real-time, consent based audio-visual interaction with the customer/beneficiary to obtain identification information including the necessary KYC documents required for the purpose of client due diligence and to ascertain the veracity of the information furnished by the customer/ beneficiary.

4.   Insurers may undertake live VBIP by developing an application which facilitates KYC process either online or face-to-face in-person verification through video. This may be used for establishment/continuation/ verification of an account based relationship or for any other services with an individual customer/beneficiary, as the case may be, after obtaining his/her informed consent and shall adhere to the following stipulations:

a)    The Insurer/authorised person while performing the VBIP for KYC shall record clear live video of the customer/beneficiary present for identification and obtain the identification information in the form as below:

                     i.    Aadhaar Authentication if voluntarily submitted by the Customer/ beneficiary, subject to notification by the government under Section 11 A of Prevention of Money-Laundering Act (PMLA)

or

                 ii.      Offline Verification of Aadhaar for identification, if voluntarily submitted by the Customer/beneficiary

or

                iii.      OVD (As defined in rule 2(d) under PML Rules 2005) provided in the following manner –

iii(1) As digitally signed document of the OVD, issued to the DigiLocker by the issuing authority

or

iii(2) As a clear photograph or scanned copy of the original OVD, through the eSign mechanism.

b)   The insurer/authorised person shall ensure that the online video is clear and the customer/beneficiary along with the authorised person in the video shall be easily recognisable and shall not be covering their face in any manner.

c)    Live location of the customer/beneficiary (Geotagging) shall be captured (both for online/ face-to-face VBIP) to ensure that customer/beneficiary is physically present in India.

d)   The authorised person/ Insurer shall ensure that the photograph and other necessary details of the customer/beneficiary in the Aadhaar/ OVD matches with the customer/beneficiary present for the VBIP.

e)    The authorised person/ Insurer shall ensure that the sequence and/or type of questions during video interactions are varied in order to establish that the interactions are real-time and not pre-recorded.

f)     In case of offline verification of Aadhaar using XML file or Aadhaar Secure QR Code, if voluntarily submitted by the Customer/ beneficiary, it shall be ensured that the generation of XML file or QR code is recent and not older than 3 days from the date of carrying out VBIP.

g)    All accounts opened or any service provided based on VBIP shall be activated only after being subject to proper verification by the insurer to ensure that the integrity of process is maintained and is beyond doubt.

h)   Insurers shall ensure that the process is a seamless, real-time, secured, end-to-end encrypted audio-visual interaction with the customer/ beneficiary and the quality of the communication is adequate to allow identification of the customer/ beneficiary beyond doubt. Insurers shall carry out the liveliness check in order to guard against spoofing and such other fraudulent manipulations.

i)     To ensure security, robustness and end to end encryption, the insurers shall carry out software and security audit and validation of the VBIP application as per extant norms before rolling it out and thereafter from time to time.

j)     The audio-visual interaction shall be triggered from the domain of the insurers itself, and not from third party service provider. The VBIP process shall be operated by the Insurer/authorized persons. The activity log along with the credentials of the official performing the VBIP shall be preserved.

k)   Insurers shall ensure that the video recording bears the GPS coordinates, date (DD:MM:YY) and time stamp (HH:MM:SS) along with other necessary details, which shall be stored in a safe and secure manner as per Prevention of Money-Laundering (PML) Rules.

While exercising Online VBIP, the Insurer shall exercise extra caution and the additional necessary details viz. IP address etc. shall be preserved by the insurer to substantiate the evidence at the time of need.

l)     Insurers are encouraged to take assistance of the latest available technology (including Artificial Intelligence (AI) and face matching technologies etc.) to strengthen and ensure the integrity of the process as well as the confidentiality of the information furnished by the customer/beneficiary. However, the responsibility of identification shall rest with the insurer.

m)  Authorized person of the insurer shall facilitate face to face VBIP process only at the customer/beneficiary end.

However, the ultimate responsibility for client due diligence will be with the insurer.

n)   Insurer shall maintain the details of the concerned Authorised person, who is facilitating the VBIP.

o)    Insurers shall ensure to redact or blackout the Aadhaar number as per extant PML Rules.

p)   Insurer will adhere to the IRDAI Cyber security guidelines as amended from time-to-time along with the necessary security features and standard as mentioned in Annexure – I

It is emphasized once again that it shall be the responsibility of the insurers that the above guideline is followed scrupulously.

Any matter not specifically mentioned herein, but mandated under the extant PMLA/ Aadhaar Act / Information Technology Act etc. and Rules framed there under by the Central Government of India shall be complied with accordingly.

Member (Life)

Annexure I

1.   The Video KYC application and related APIs/Web Services shall undergo application security testing (both gray box and white box) through an CERT-In empanelled vendor and all reported vulnerabilities shall be mitigated before moving into production.

2.   The infrastructure components used for hosting Video KYC application shall undergo vulnerability assessment and secure configuration review through an CERT-In empanelled vendor and all reported vulnerabilities shall be mitigated before moving into production.

3.   There shall be an end-to-end encryption from the customer/beneficiary to the hosting point of the Video KYC application. The minimum encryption standards and key lengths like AES 256 for encryption should be used.

4.   If the Video KYC application and video recordings are located at a third party location and/or in Cloud then the third party location and/or cloud hosting location shall be in India.

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