SEBI Stock Broker Regulations Part-4 Code of Conduct

SECURITIES AND EXCHANGE BOARD OF INDIA
(STOCK BROKERS & SUB-BROKERS) Regulations, 1992
CODE OF CONDUCT FOR SUB-BROKERS
(Regulation 15)
A. GENERAL
(1) INTEGRITY: A sub-broker, shall maintain high standards of integrity, promptitude
and fairness in the conduct of all investment business.
(2) EXERCISE OF DUE SKILL AND CARE: A sub-broker, shall act with due skill, care
and diligence in the conduct of all investment business.
B. DUTY TO THE INVESTOR
(1) EXECUTION OF ORDERS: A sub-broker, in his dealings with the clients and the
general investing public, shall faithfully execute the orders for buying and selling of
securities at the best available market price. A sub-broker shall promptly inform his client
about the execution or non-execution of an order 61[******]
62 [(2) A sub-broker shall render necessary assistance to his client in obtaining the
contract note from the stock broker]
(3) BREACH OF TRUST: A sub-broker shall not disclose or discuss with any other
person or make improper use of the details of personal investments and other information
of a confidential nature of the client which he comes to know in his business relationship.
(4) BUSINESS AND COMMISSION:
(a) A sub-broker shall not encourage sales or purchases of securities with the sole object
of generating brokerage or commission.
(b)A sub-broker shall not furnish false or misleading quotations or give any other false or
misleading advice or information to the clients with a view of inducing him to do
61 Words ‘and make payment in respect of securities sold and arrange for prompt delivery of securities
purchased by clients” inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations,
2003, w.e.f. 23-9-2003.
62 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2003, w.e.f. 23-9-
2003 for the words, “
(2) A. Issue of purchase or sale notes:
(a) A sub-broker shall issue promptly to his clients purchase or sale notes for all the transactions entered
into by him with his clients.
(b) A sub-broker shall issue promptly to his clients scrip wise split purchase or sale notes and similarly bills
and receipts showing the brokerage separately in respect of all transactions in the specified form.
(c) A sub-broker shall only split the contract notes client-wise and scrip wise originally issued to him by the
affiliated broker into different denominations.
(d) A sub-broker shall not match the purchase and sale orders of his clients and each such order must
invariably be routed through a member-broker of the stock exchange with whom he is affiliated.”
business in particular securities and enabling himself to earn brokerage or commission
thereby.
(c)A sub-broker shall not charge from his clients a commission exceeding one and onehalf
of one percent of the value mentioned in the respective sale or purchase notes.
(5) BUSINESS OF DEFAULTING CLIENTS: A sub-broker shall not deal or transact
business knowingly, directly or indirectly or execute an order for a client who has failed
to carry out his commitments in relation to securities and is in default with another broker
or sub-broker.
(6) FAIRNESS TO CLIENTS: A sub-broker, when dealing with a client, shall disclose
that he is acting as an agent 63[******] ensuring at the same time, that no conflict of
interest arises between him and the client. In the event of a conflict of interest, he shall
inform the client accordingly and shall not seek to gain a direct or indirect personal
advantage from the situation and shall not consider clients' interest inferior to his own.
(7) INVESTMENT ADVICE: A sub-broker shall not make a recommendation to any
client who might be expected to rely thereon to acquire, dispose of, retain any securities
unless he has reasonable grounds for believing that the recommendation is suitable for
such a client upon the basis of the facts, if disclosed by such a client as to his own
security holdings, financial situation and objectives of such investment. The sub-broker
should seek such information from clients, wherever they feel it is appropriate to do so.
64[7A – Investment Advice in publicly accessible media –
(a) A sub-broker or any of his employees shall not render, directly and indirectly any
investment advice about any security in the publicly accessible media, whether real –
time or non real-time, unless a disclosure of his interest including his long or short
position in the said security has been made, while rendering such advice.
(b) In case, an employee of the sub-broker is rendering such advice, he shall also disclose
the interest of his dependent family members and the employer including their long or
short position in the said security, while rendering such advice.]
(8) COMPETENCE OF SUB-BROKER: A sub-broker should have adequately trained
staff and arrangements to render fair, prompt and competent services to his clients and
continuous compliance with the regulatory system.
63 Words, ‘and shall issue appropriate purchase / sale note” omitted by the SEBI (Stock Brokers and Subbrokers)
(Amendment) Regulations, 2003, w.e.f. 23-9-2003.
64 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2003, w.e.f. 29-5-
2001.
C. SUB-BROKERS VIS-A-VIS STOCK BROKERS
(1) CONDUCT OF DEALINGS: A sub-broker shall co-operate with his broker in
comparing unmatched transactions. Sub-broker shall not knowingly and willfully deliver
documents which constitute bad delivery. A sub-broker shall co-operate with other
contracting party for prompt replacement of documents which are declared as bad
delivery.
(2) PROTECTION OF CLIENTS INTERESTS: A sub-broker shall extend fullest cooperation
to his stock-broker in protecting the interests of their clients regarding their
rights to dividends, right or bonus shares or any other rights relatable to such securities.
(3) TRANSACTIONS WITH BROKERS: A sub-broker shall not fail to carry out his
stock broking transactions with his broker nor shall he fail to meet his business liabilities
or show negligence in completing the settlement of transactions with them.
65[(4) Agreement between sub-broker, client of the sub-broker and main broker: A subbroker
shall enter into a tripartite agreement with his client and with the main stock
broker specifying the scope of rights and obligations of the stock broker, sub-broker and
such client of the sub-broker]
(5) ADVERTISEMENT AND PUBLICITY: A sub-broker shall not advertise his
business publicly unless permitted by the stock exchange.
(6) INDUCEMENT OF CLIENTS: A sub-broker shall not resort to unfair means of
inducing clients from other brokers.
D. SUB-BROKERS VIS-A-VIS REGULATORY AUTHORITIES.
(1) GENERAL CONDUCT: A sub-broker shall not indulge in dishonourable, disgraceful
or disorderly or improper conduct on the stock exchange nor shall he wilfully obstruct the
business of the stock exchange. He shall comply with the rules, bye-laws and regulations
of the stock exchange.
(2) FAILURE TO GIVE INFORMATION: A sub-broker shall not neglect or fail or
refuse to submit to the Board or the stock exchange with which he is registered, such
books, special returns, correspondence, documents, and papers or any part thereof as may
be required.
(3) FALSE OR MISLEADING RETURNS: A sub-broker shall not neglect or fail or
refuse to submit the required returns and not make any false or misleading statement on
any returns required to be submitted to the Board or the stock exchanges.
65 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2003, w.e.f. 23-9-
2003.
(4) MANIPULATION: A sub-broker shall not indulge in manipulative, fraudulent or
deceptive transactions or schemes or spread rumours with a view to distorting market
equilibrium or making personal gains.
(5) MALPRACTICES : A sub-broker shall not create false market either singly or in
concert with others or indulge in any act detrimental to the public interest or which leads
to interference with the fair and smooth functions of the market mechanism of the stock
exchanges. A sub-broker shall not involve himself in excessive speculative business in
the market beyond reasonable levels not commensurate with his financial soundness.
SCHEDULE III
SECURITIES AND EXCHANGE BOARD OF INDIA
(Stock Brokers And Sub-Brokers) Regulations, 1992
(Regulation 10)
I. FEES TO BE PAID BY THE STOCK-BROKER
1. Every stock-broker shall subject to paragraphs 2 and 3 of this Schedule pay registration
fees in the manner set out below:
(a) Where the annual turnover does not exceed rupees one crore during any financial
year, a sum of rupees five thousand for each financial year or;
(b) Where the annual turnover of the stock-broker exceeds rupees one crore during any
financial year, a sum of rupees five thousand plus one hundredth of one percent of the
turnover in excess of rupees one crore for each financial year;
66 [(bb) Notwithstanding anything contained in clause (b) it is clarified that the fee shall
be recoverable as computed as under:
(i) in respect of jobbing transactions that is to say all transactions which are squared off
during the same day which have not been undertaken by the broker on behalf of clients,
the fees shall be computed at the rate of one two hundredth of one percent in respect of
the sale side of such transactions;
(ii) in respect of transactions in Government securities, the bonds issued by any Public
Sector Undertaking and the units traded in a similar manner, the fee payable shall be
computed at the rate of one thousandth of one percent of the turnover;
66 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2002, w.e.f. 20-2-
2002.
(iii) in case of carry forward, renewal or badla transactions the fees shall be computed at
the rate of one hundredth of one percent of the turnover and the reverse off setting
transactions shall not be counted as part of the turnover.
(iv) if brokers are carrying out transactions in securities without reporting them to the
stock exchange, those transactions shall be taken into account for the purpose of turnover
and the fees shall be computed at the rate of one hundredth of one percent of the
turnover;
(v) the trade put through on other stock exchanges shall be included in the turnover of
that exchange if market for that security does not exist on the exchange of which he is a
member and the fees shall be computed at the rate of one hundredth of one percent of the
turnover;
(vi) activity such as underwriting and collection of deposits shall not be taken into
account for the purpose of calculating the turnover’.]
(c) After the expiry of five financial years from the date of initial registration as a stockbroker,
he shall pay a sum of rupees five thousand for 67[every] block of five financial
years commencing from the sixth financial year after the date of grant of initial
registration to keep his registration in force.
2. Fees referred to in clause (a) and (b) of paragraph 1 above shall be paid -
(a) in respect of the financial year 1992-1993 within one month of the commencement of
these regulations;
(b) in respect of the financial year beginning on the 1st day of April, 1993 and the
following financial years, on or before the first day of October of the financial year to
which such payment relates,
and such fees shall be computed with reference to the annual turnover relating to the
preceding financial year.
3. Every remittance of fees referred to in clauses (a) and (b) of paragraph 1, shall be
accompanied by a certificate as to the authenticity of turnover on the basis of which fees
have been computed duly signed by the stock exchange of which the stock-broker is a
member or by a qualified auditor as defined in Section 226 of the Companies Act, 1956.
Explanation - For the purposes of paragraphs 1, 2 and 3 "annual turnover" means the
aggregate of the sale and purchase prices of securities received and receivable by the
67 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2002, w.e.f. 20-2-
2002.
stock broker either on his own account as well as on account of his clients in respect of
sale and purchase or dealing in securities during any financial year.
68[4. Where a corporate entity has been formed by converting the individual or
partnership membership card of the exchange, such corporate entity shall be exempted
from payment of fee for the period for which the erstwhile individual or partnership
member, as the case may be, has already paid the fees subject to the condition that the
erstwhile individual or partner shall be the wholetime Director of the corporate member
so converted and such Director will continue to hold minimum 40% shares of the paid-up
equity capital of the corporate entity for a period of at least three years from the date of
such conversion]
69[“Explanation: It is clarified that the conversion of individual or partnership
membership card of the exchange into corporate entity shall be deemed to be in
continuation of the old entity and no fee shall be collected again from the converted
corporate entity for the period for which the erstwhile entity has paid the fee as per the
regulations”].
70[4A. Where a stock exchange has formed a subsidiary company, which has become a
stock broker of another stock exchange, then the turnover of the stock broker who is
buying, selling or dealing in securities, through the subsidiary company as a sub-broker,
shall be excluded from the turnover of the subsidiary company, only if the stock broker
has paid five years turnover based fees plus fee for a block of five years in accordance
with the regulations, on the concerned stock exchange which has formed the subsidiary
company.]
71[5. If a stock broker fails to remit fees in accordance with paragraph 1 and 2, he shall be
liable to pay interest @ 15% per annum for each month of delay or part thereof;
Provided that the liability to pay interest as aforesaid may be addition to any other action
which the Board may take as deem fit against the stock broker under the Act, or the
Regulations;
Provided further that if the liability of the stock broker on account of payment of interest
works out to be Rs. 100 or less the same may be waived off by the Board taking into
consideration the administrative cost involved in recovering the said amount].
68 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Second Amendment) Regulations, 1998, w.e.f.
21-1-1998.
69 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 1998, w.e.f. 20-2-
2002.
70 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2000, w.e.f. 30-8-
2000.
71 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment) Regulations, 1998, w.e.f. 16-
12-1998.
72[“II. Fees to be paid by sub-brokers
Every sub-broker shall pay fees in the manner set out below:
(a) Where a sub-broker was granted certificate of registration by the Board before
August 1, 2006 -
(i) he shall pay a sum of ten thousand rupees for the block of five financial
years commencing from April 1, 2007; and
(ii) after the expiry of the said block of five financial years, he shall pay a sum
of five thousand rupees for every subsequent block of five financial years.
(b) Where a sub-broker is granted certificate of registration by the Board on or
after August 1, 2006 -
(i) he shall pay a sum of ten thousand rupees for the block of five financial
years commencing from the financial year in which registration has been
granted; and
(ii) after the expiry of the said block of five financial years, he shall pay a
sum of five thousand rupees for every subsequent block of five financial
years.
(c) Every sub-broker shall pay fees under sub-clause (a) or sub-clause (b), as the
case may be, within such time as may be specified by the Board.”]
III. MANNER OF FEES TO BE PAID
73[The fees indicated above shall be paid on or before the 1st day of October each year
payable by draft in favour of the Securities and Exchange Board of India at Bombay or at
the respective regional office].
74[IV.Non-applicability to stock – brokers governed by Schedule IIIA.
The provisions of this schedule shall not apply to stock brokers to whom Schedule III-A
applies, from the time when it becomes so applicable.]
72 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment) Regulations, 1998, w.e.f.
16-12-1998 for the words,
“II. FEES TO BE PAID BY SUB-BROKER:
(a) A Sub-broker shall pay a fee of rupees one thousand for each financial year for an initial
period of five years.
(b) After the expiry of the five years mentioned above, the sub-broker shall pay a fee of rupees
five hundred for each financial year as long as the Certificate remains in force.”
73 Substituted by the SEBI (Payment of Fees) (Amendment) Regulations, 1995, w.e.f. 28-11-1995 for the
words,
“The fees indicated above shall be paid on or before the 1st day of October each year
payable by a cheque or draft in favour of the Securities and Exchange Board of India" at
Bombay”
74 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment) Regulations, 2006, w.e.f. 1-
10-2006.
75[“Schedule III-A
PAYMENT OF FEES BY STOCK BROKERS
[Regulation 10(1)]
Part A – Applicability
1. This schedule shall apply to stock brokers from the following points of time:
(a) All stock brokers who are granted registration by the Board on or after the first
day of October, 2006 – upon grant of such registration;
(b) All stock brokers who were granted registration by the Board on or after the first
day of April, 2006, but before the first day of October, 2006 – from the first day
of October, 2006;
(c) All stock brokers who have not completed five financial years from the date of
grant of registration by the Board, as on the thirty first day of March, 2006 – upon
completion of ten financial years from the date of grant of registration by the
Board;
(d) All stock brokers who have completed five financial years from the date of grant
of registration by the Board, as on the thirty first day of March, 2006 – upon
completion of the current block of five financial years, within the meaning of item
I(1)(c) of Schedule III;
(e) All stock brokers falling under sub-clauses (c) or (d), who opt in accordance with
clause 2 to be governed by the provisions of this Schedule – from such date as
may be specified by the Board.
2. Stock brokers falling under sub-clauses (c) or (d) of clause 1 may opt to pay fees in
accordance with this Schedule before completion of the relevant time periods mentioned
in those sub-clauses, by exercising an option in writing to that effect and communicating
it to the Board, in such manner and within such time as may be specified by the Board.
Part B – Charge of fees
3. On and from the applicability of this Schedule, every stock broker shall pay to the
Board in accordance with Part C, a fee in respect of the securities transactions including
off-market transactions undertaken by them, at the rates mentioned below:
Sl.
No.
Nature of the securities
transaction
Rate of fee
a. All sale and purchase
transactions in securities other
than debt securities.
0.0002 per cent. of the price at which
the securities are purchased or sold
(Rs.20/- per crore)
b. All sale and purchase
transactions in debt securities.
0.00005 per cent. of the price at which
the securities are purchased or sold
(Rs.5/- per crore)
75 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment) Regulations, 2006, w.e.f. 1-
10-2006..
4. Nothing in clause 3 shall affect the liability of any stock broker to pay fees under
Schedule III, which accrued before this Schedule became applicable to him and such fees
shall be paid as per the relevant provisions of Schedule III as if they had not ceased to be
applicable to him.
Part C – Manner of payment and recovery
5. (1) Every recognised stock exchange shall collect from every stock broker to whom
this Schedule applies, the fee payable under clause 3 in respect of -
(a) securities transactions entered into by him in that stock exchange; and
(b) off-market transactions entered into by him which are reported to that stock
exchange –
in accordance with the provisions of its bye-laws.
Explanation: The Board may specify the manner in which fees shall be collected from
stock brokers who report the same transactions to different stock exchanges in which they
are members, under clause (b).
(2) The fee collected by a recognised stock exchange under sub-clause (1) during a
calendar month shall be paid by the stock exchange to the Board by the fifth working day
of the following calendar month.
(3) All recognised stock exchanges shall maintain such registers and furnish such returns
or information to the Board in respect of the fee collected under this Schedule, as may be
specified by the Board.
(4) Without prejudice to sub-clause (3), a recognised stock exchange shall also be liable
to furnish such information or explanations to the Board as may be required by it in
respect of fee collected or liable to be collected under this Schedule.
6. (1) Nothing contained in clause 5 shall affect the primary liability of a stock broker to
pay the fees under clause 3 or shall preclude the Board from recovering any such fee
remaining unpaid by any stock broker directly from him.
(2) Where due to the stock broker’s default any fee which was liable to be paid on his
behalf under clause 5 remains unpaid or is paid belatedly, he shall, without prejudice to
any other action that may be taken under the Act, rules or regulations, pay an interest of
15 per cent. per annum for every month of delay or part thereof to the Board.
(3) Every stock broker shall be liable to furnish such information or explanations to the
Board as may be required by it in respect of fee paid or payable under this Schedule.”]
[SCHEDULE IV
[Regulation 16G (1)]
FEES TO BE PAID BY THE TRADING OR CLEARING MEMBER 76[OR SELFCLEARING
MEMBER] OF DERIVATIVES EXCHANGE / DERIVATIVES
SEGMENT / CLEARING CORPORATION / CLEARING HOUSE.
1. A clearing member shall pay a fee of 77[Rs. 50, 000/-] every year till his registration is
in force, in the manner specified below:-
(a) for the first financial year along with the application for registration;
(b) for the subsequent financial years before 1st June of that financial year.
78[“2. Every trading member shall pay to the Board, a fee in respect of the transactions
undertaken by him on the derivatives segment of a recognised stock exchange, at the rate
of 0.0002 per cent. of his turnover (Rs.20/- per crore).
76 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations, 2001, w.e.f. 15-11-
2001.
77 Substituted for Rs. 25,000 by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment)
Regulations, 2006, w.e.f. 1-10-2006..
78 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment) Regulations, 2006, w.e.f.
1-10-2006. Prior to substitution, it was read as under:
“2. A trading member shall pay every year a fee till his registration is in force, in the
manner specified below:-
(a) where the annual turnover does not exceed Rs. 500 crore in the financial year, a sum
of Rs. 10, 000 for each financial year; and
(b) where the annual turnover exceeds Rs. 500 crore in the financial year, a sum of Rs.
10, 000 plus 10 paisa per Rs. 1, 00, 000 of turnover, for the turnover in excess of Rs. 500
crore in the financial year.
Explanation: For the purpose of clause 2, the expression `annual turnover’ shall mean the
aggregate value of all trades executed by the trading member on the derivatives exchange
or the derivatives segment and shall also include the value of trades settled on the
expiration of derivatives contracts.
59*[However, for option contracts, the `annual turnover’ shall be computed on the basis of
the premium traded for the option contracts and in case where the option is exercised /
assigned, the `annual turnover’ shall be computed on the basis of the notional value of the
Explanation: (A) For the purpose of this clause, the expression ‘turnover’ shall include
the value of the trades executed by the trading member on the derivatives segment of the
recognised stock exchange and of the trades settled on the expiration of derivatives
contracts.
(B) In case of options contracts, ‘turnover’ shall be computed on the basis of premium
traded for the option contracts and in case where the option is exercised or assigned, it
shall be additionally computed on the basis of notional value of option contracts
exercised or assigned.”]
79[2A The “self-clearing member” shall pay every year a fee as specified in clause 1 & 2.
The provisions of clauses 3 to 6 shall be applicable mutatis mutandis to a self-clearing
member.]
80[“3. (1) Every recognised stock exchange shall collect from every trading member,
clearing member and self-clearing member, the fee payable under clause 2 in respect of
his turnover in the derivatives segment of that stock exchange in accordance with the
provisions of its bye-laws.
(2) The fee collected by a recognised stock exchange under sub-clause (1) during a
calendar month shall be paid by the stock exchange to the Board by the fifth working day
of the following calendar month.
option contracts exercised / assigned, in addition to the annual turnover’ computed on the
basis of premium traded]
79 Inserted by the SEBI (Stock Brokers and Sub-brokers) (Amendment) Regulations,
2003, w.e.f. 15-11-2003.
80 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment)
Regulations, 2006, w.e.f. 1-10-2006. Prior to substitution, it was read as under:
“3. Every remittance of fees by a trading member as specified in clause 2 shall be made
every financial year as under:-
(a) For the first financial year in which certificate of registration is granted a sum of Rs.
10, 000/- shall be paid along with the application for registration.
(b) For the subsequent financial years from the initial registration:
(i) A sum of Rs. 10, 000/- shall be paid before 1st June of that financial year; and
(ii) A balance fee of the preceding financial year for the turnover in excess of Rs.500
crores shall be paid before the 1st June of the financial year.
(c) The remittance shall be accompanied by a certificate authenticating the turnover by
the concerned derivatives exchange or derivatives segment.”

(3) All recognised stock exchanges shall maintain such registers and furnish such returns
or information to the Board in respect of the fee collected under this Schedule, as may be
specified by the Board.
(4) Without prejudice to sub-clause (3), a recognised stock exchange shall also be liable
to furnish such information or explanations to the Board as may be required by it in
respect of fee collected or liable to be collected under this Schedule.”]
4. A trading member who also acts as a clearing member shall pay the annual fee
separately, as applicable to each category 81[as specified in clause 1 and 2 above].
82[“5. (1) Nothing contained in clause 3 shall affect the primary liability of a trading
member to pay the fees under clause 2 or shall preclude the Board from recovering any
such fee remaining unpaid by any trading member directly from him.
(2) Where due to the trading member’s default any fee which was liable to be paid on his
behalf under clause 3 remains unpaid or is paid belatedly, he shall, without prejudice to
any other action that may be taken under the Act, rules or regulations, pay an interest of
15 per cent. per annum for every month of delay or part thereof to the Board.
(3) Every trading member shall be liable to furnish such information or explanations to
the Board as may be required by it in respect of fee paid or payable under this
Schedule.”]
6. The financial year shall mean the year commencing from 1st April and ending on 31st
March of the following year.
** Notification: No. GSR 780(E), dated 23-10-1992.s
81 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment)
Regulations, 2006, w.e.f. 1-10-2006 for the words, “as specified in clause 2 and 3”
82 Substituted by the SEBI (Stock Brokers and Sub-brokers) (Third Amendment)
Regulations, 2006, w.e.f. 1-10-2006 for the words,
“ 5. The fees indicated above shall be paid by draft in favour of ` Securities and Exchange
Board of India, Mumbai’. Such draft shall be forwarded to the Board through the
concerned derivatives exchange or derivatives segment or clearing corporation or
clearing house.’’