Amendment to the IFSCA (Vault Manager) Circular, 2021
OVERVIEW-
The International Financial Services Centers Authority (IFSCA) has issued a circular announcing amendments to the guidelines for Vault Managers operating within International Financial Services Centres (IFSCs).
The circular modifies certain clauses of the IFSCA (Vault Manager) Circular, 2021, originally issued on August 25, 2021.
WHO IS A VAULT MANAGER-
The vault manager is regulated as a SEBI intermediary for providing vaulting services meant for gold deposited to create Electronic Gold Receipts (EGRs).
Obligations of the vault manager:
Accepting deposits, storage, and safekeeping of gold,
creation as well as withdrawal of EGR,
grievance redressal, and
periodic reconciliation of physical gold with the records of the depository.
REGISTRATION OF ADDITIONAL VAULT-
The revised circular allows registered Vault Managers to apply for the registration of additional vaults under their existing registration.
This amendment streamlines the process for expanding vault facilities within IFSCs, enhancing operational flexibility for Vault Managers.
EXEMPTION FROM ADDITONAL SECURITY DEPOSIT-
An important proviso has been inserted exempting registered Vault Managers from providing additional security deposits when registering additional vaults under existing registrations.
This provision aims to reduce financial burden and administrative complexities for Vault Managers expanding their operation.
RETENTION OF SECURITY DEPOSIT-
The circular specifies that the security deposit furnished by Vault Managers with the bullion depository shall remain retained until the Vault Manager surrenders the certificates of registration for all its vaults registered with the Authority.
This provision ensures compliance with regulatory requirements and underscores the importance of maintaining security standards.
CONCLUSION-
The IFSCA’s circular regarding amendments to the Vault Manager guidelines introduces significant changes aimed at facilitating the expansion of vault facilities within IFSCs while ensuring regulatory compliance and security standards.
These amendments provide clarity and flexibility to Vault Managers, thereby fostering a conducive environment for the growth of the financial services sector within IFSCs.
Stakeholders are encouraged to review the circular thoroughly and adapt their operations accordingly to leverage the benefits of these regulatory changes.