January 24, 2012

Dear Participants / Account Holders,

As you are aware, CDC has introduced the ‘Reason Code’ field in CDS for Intra and Inter Account Free Delivery (FD) transactions and has made the selection of these reasons codes mandatory to bring further transparency in the day to day transactions. Hence, Participants must make correct use of reason codes while making Intra and Inter Account Free Delivery Transaction in the CDS.

It is also important to note that as per CDC Regulations, there are certain transactions which (amongst other Regulatory requirement) are also required to be reported to the relevant Stock Exchange in the manner as prescribed by such exchange. These transactions are summarized as follows: 

                                                                                  Reason Code

                                                 Intra Account movement                 Inter Account movement

1. Off-Market Transactions                               A020                                       P014

2. Transfer due to non payment                         A039                                         ---

3. Gift (other then Family members)                   A029                                       P022

It has been observed that some members are not complying with the Regulations relating to reporting the above transaction to the Stock Exchanges. Kindly note that this is a direct violation of the CDC Regulations. Therefore, Participants are requested to ensure compliance with the relevant CDC Regulations.

We thank you for your cooperation which will ensure smooth functioning of the capital market functions on a day-to-day basis. Should you have any queries or concerns, please feel free to contact our Customer Support Services at 0800-CDCPL (23275).

Regards,

Ejaz Ali Shah

General Manager – Head of Marketing &

Customer Support Services