Shares of stock broking firms declined on Tuesday, a day after markets regulator Sebi directed stock exchanges and other market infrastructure institutions (MIIs) to implement a uniform and equal charge structure for all members rather than varying charges based on their volume or activity.
The stock of Angel One tumbled 10.50 per cent, Geojit Financial Services tanked 5.86 per cent, Dolat Algotech dropped 5.39 per cent, 5paisa Capital declined 4.51 per cent, Motilal Oswal Financial Services went lower by 3.70 per cent and SMC Global Securities dipped 2.41 per cent on the BSE.
The regulator instructed stock exchanges, clearing corporations, and depositories constituted as MIIs to ensure that any charges recovered from the end client are 'True to Label'.
It means that if a certain charge is levied on the end client by members -- stock brokers, depository participants, clearing members -- it should be ensured by MIIs that the same amount is received by them.
"To begin with, the new charge structure designed by MIIs should give due consideration to the existing per unit charges realised by MIIs, so that the end-clients are benefited from the reduction of charges," Sebi said in a circular on Monday.
The regulator has asked MIIs to comply with these additional principles while designing the processes for charges levied on their members, which are to be recovered from the end-clients.
MIIs, being public utility institutions, act as first-level regulators, and are entrusted with the responsibility of providing equal, unrestricted, transparent and fair access to all market participants.
