Sebi Simplifies Process For Transmission Of Securities to Legal Heirs; Know How It’ll Work

The capital markets regulator, the Securities and Exchange Board of India (Sebi), has simplified the procedure for transmission of securities to the nominees or legal heirs after the holder’s demise. It has also standardisation the formats for the documentation of the process, besides enhancing the limit for simplified documentation.

Transmission of securities comes into play when the sole holder of the security has deceased, and his next legal heir or nominee or any other person named in his Will receives the securities. It is not the same as transfer of securities.

“As an on-going measure to enhance ease of dealing in securities markets and with a view to make the transmission process more efficient and investor-friendly, the procedure for transmission of securities has been further simplified,” Sebi said in the circular.

How Will The New System Work?

• Sebi has provided a ready reckoner which lists out all the documents which will be required for transmission of securities in case of demise of the sole account holder.
• Sebi has also laid out updated operational guidelines for processing of investors’ service requests, specifically for the transmission of securities.
• The circular said that if the securities were held in a single name with a proper nomination, then during their transmission, documents like transmission request form (in the specified format) filled by the nominee, original death certificate or a copy of it attested by the nominee and PAN card of the nominee will need to be submitted.
• However, if the securities held by the deceased are without nomination, then documents like a notarised affidavit from all the legal heirs made on a non-judicial stamp paper of appropriate value which intends to identify and claim the legal ownership of all the securities held by the deceased needs to be submitted apart from other required documents.
• Lastly, if the deceased has named the legal heirs in their Will who are entitled to receive the securities, then a succession certificate or Probate of Will, legal heirship certificate or its equivalent certificate, along with other documents mentioned above, will have to be submitted. 
   

Enhanced Limit For Simplified Documentation

Sebi has also enhanced the monetary limits for simplified documentation for the transmission of securities. 

If anyone is holding securities in physical mode, then the current threshold limit for simplified documentation of Rs 2 lakh will be enhanced to Rs 5 lakh.
If the securities are being held in demat mode, then the existing limit of Rs 5 lakh has been increased to Rs 15 lakh for each beneficiary account.