NCDEX Institute of Commodity Markets and Research
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NCDEX Institute of Commodity Markets and Research
Frequently Asked Questions

Certified Emission Reductions (CERs)
1 How will deliveries of CERs take place?
2 What alternative mechanisms for GHG emission reductions does the Kyoto Protocol (KP) provide for? How do developing countries participate in these mechanisms?
3 What are Certified Emission Reductions (CERs) and how are they issued?
4 What are Emission Allowances?
5 What are Greenhouse Gases (GHGs)?
6 What are the price indicators for CERs?
7 What are UNFCCC and Kyoto Protocol?
8 What is Carbon Trading?
9 What is CDM?
10 What is so unique about the NCDEX initiative?
11 What is the market potential of CERs?
12 What will be major features of NCDEX CER futures contract?
13 Which are the major greenhouse gases (GHGs) and what is a carbon dioxide equivalent (CO2e)?
14 Which other exchanges are organizing trading of CERs?
15 Who are the major buyer and sellers of carbon credits?
16 Why are GHGs traded?
17 Why is the NCDEX CER futures contract a DEC expiry contract?
Compliance
1 Are all the members of the Exchange required to take fidelity insurance?
2 Can a member enter into a common member client agreement with the client for all the Exchanges?
3 Can digitally signed contract note be issued?
4 Can the logo of the Exchange be used by the member for issue of advertisement, use on letter head, visiting cards or website of the member?
5 Is a copy of income tax returns mandatory to be collected by the members from the client at the time of registration or KYC?
6 Is there any restriction on the members to carryout any activity other than trading on the Exchange platform like trading in securities?
7 What are the guidelines for appointment of Compliance Officers by the members?
8 What are the guidelines for Brokerage to be charged by the member?
9 What are the guidelines for display of details at members office ?
10 What are the guidelines for issue of advertisement by the members?
11 What are the guidelines for portfolio management services by the members?
12 What are the guidelines for trading in in-active client codes by the member?
13 What are the guidelines issued by the Exchange for issue of contract notes?
14 Whether a member can trade through another trading member?
15 Whether prior approval of the Exchange is required for issue of advertisement?
CTCL Terminal
1 How many CTCL Terminals can be created on one CTCL user id?
Membership
1 Are the course materials available for the proposed exam to be undertaken by the core dealer?
2 Are the memberships to be taken afresh for each of the products to be traded in NCDEX from time to time?
3 At what point of time one has to comply with the Net worth requirements?
4 Can one use the NSE terminal to trade in NCDEX?
5 Can we apply for the membership under the HUF account?
6 How could a new company submit the 3 years balance sheet?
7 How is the net worth calculated for a new subsidiary?
8 How NCDEX is different from other exchanges?
9 Is it a must that the individual should be a graduate?
10 Is NCDEX a separate legal corporate entity?
11 Is there any additional cost towards acquiring membership in addition to what has been specified in the application form?
12 Please indicate the permissible brokerage structure and brokerage pattern.
13 What are the benefits in futures trading in commodities?
14 What are the commodities identified for trading?
15 What are the member ship charges?
16 What are the trading hours?
17 What is the essential requirement for collateral?
18 What is the lock in period for the interest free security deposit?
19 What is the meaning of dominant promoter group?
20 What is your membership scrutiny process?
21 What should be the main objective clause in the Memorandum of Association to aid in trading in commodity futures?
22 When is the security deposit eligible for refund in case of surrender?
23 Whether a designated director in an entity having membership of BSE assume similar responsibility /designation in the new subsidiary formed for taking membership of NCDEX.
24 Whether exposure will be allowed against base capital and collateral?
25 Whether one can use the idle NSE terminal for trading on NCDEX?
26 Whether qualifying director in entity being member of NSE assume similar responsibility /designation in the new subsidiary formed for commodity exchange?
27 Whether Regulators, i.e., Forward Market Commission, levy any turnover fee?
28 Whether the networth of the holding company will be taken into consideration for the same?
29 Whether we can apply for the membership of NCDEX in the same name in which we are holding the membership of NSEIL?
30 Which are the other multi commodity exchanges in the country?
31 Who can become member of NCDEX?
32 Who will certify the various certificates, which are required to be certified by the auditor of the company?
33 Will the exchange plan to have market makers?
Sales Tax
1 Can sales tax exemptions be availed? How?
2 Does the trading / clearing member need to have sales tax registration?
3 Do the clients/participants need to have sales tax registration?
4 How should the client/participant move the commodities into the designated warehouses?
5 If a client/participant trades in more than one commodity having delivery centers in different States does he need sales tax registration in each of such states?
6 In which file the amount of Sales Tax Collected/paid is reflected?
7 In which state sale tax registration is to be obtained?
8 Is sales tax registration necessary for those commodities which are inclusive of all taxes and levies?
9 What are the procedure for submission of the support documents /certificates / declarations for availing the sales tax exemptions?
10 What is AMC Certificate?
11 What is Anugya patra?
12 What is rate of sales tax applicable?
13 When is the sales tax payable by the buyers?
14 Who is responsible for payment of sales tax?
Service Tax
1 How to get registration?
2 How to pay Service Tax?
3 In case of delayed payment, whether interest is to be paid?
4 Is it compulsory to register as a service provider?
5 On what basis service tax is payable - on the amount billed or received?
6 What are the records to be maintained by the service provider (member)?
7 What is Service Tax? How many services are covered?
8 What is the rate of Service Tax?
9 Whether registration should be done for each service provided by the service provider?
10 Who is liable to pay service tax?
Settlement
1 Are deliveries compulsory?
2 Can commodities be re-deposited in the warehouse after the validity period of the assayer's certificate?
3 How many warehouses would be there?
4 How will you ensure uniformity in delivered grades / varieties?
5 How would a buyer take physical delivery?
6 How would a seller get the electronic balance for the physical holdings?
7 How would contracts settle?
8 How would disputes be resolved?
9 How would the buyer give a declaration for re-sale in case of last point collection of tax?
10 How would the seller give an invoice to the buyer?
11 How would the settlement take place in commodity futures market?
12 How would you accredit warehouses?
13 Is NCDEX going to have its Clearing Corporation?
14 What happens to the sales tax?
15 What happens when the commodities reach the validity date?
16 What is the procedure for handling bad delivery / part delivery?
17 What would be the settlement period?
18 What would be transaction charges?
19 Whether the accredited warehouses would be dedicated warehouses?
20 Who maintains and the Settlement Guarantee Fund?
21 Who will be certifying / assaying agencies. Will they also give the time validity for the commodities certified?
22 Who would be the clearing bankers?
23 Who would be the depository participants?
24 Who would decide the warehousing charges?
25 Would additional margins be levied for deliverable positions?
26 Would commodities be accepted without assayer's certificate?
27 Would health checks and inventory verification be carried out?
28 Would there be any premium / rebates for the difference in quality
29 Would you be providing for deliveries?
Stamp Duty
1 Can a member pay stamp duty in states other than where the client is registered and trading?
2 Can a member pay stamp duty of all his clients at one location?
3 How is stamp duty applicable?
4 How is the Stamp Duty to be paid, Is it State Wise?
5 If Stamp Duty is applicable in two states, one where the Client is registered and the other i.e. the registered office then, Is he required to pay stamp duty at both places?
6 Is stamp duty applicable for Pro Trading also?
7 Where can a person verify the percentage of stamp duty applicable on futures contract?
Technology
1 Are VSATs compulsory?
2 Is there a facility of buy back of VSAT in case of surrender of membership?
3 When would the payment be made?
4 Which protocol is being used?
5 Who would provide the services?
6 Why is the same network of NSE not being considered?
7 Would the same technology infrastructure of NSE be used?
NCDEX Institute of Commodity Markets and Research