(1) Every 58[custodian] shall have adequate mechanisms for the purposes of reviewing, monitoring and evaluating the custodian's controls, systems, procedures and safeguards.
(2) The 59[custodian] shall cause to be inspected annually the mechanism referred to in sub-regulation (1) by an expert and forward the inspection report to the Board within three months from the date of inspection.
51 Substituted ibid for the words “custodian of securities”.
52 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
53 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
54 Substituted ibid for the words “custodian of securities”.
55 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
56 Substituted ibid for the words “custodian of securities”.
57 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
58 Substituted ibid for the words “custodian of securities”.
Prohibition of assignment.
15. No 60[custodian] shall assign or delegate its functions as a 61[custodian] to any other person unless such person is a 62[custodian]:
63[Provided that a 64[custodian] may engage the services of a person not being a custodian, for the purpose of physical safekeeping of 65[goods or] gold belonging to its client 66[including] a mutual fund having a gold exchange traded fund scheme, subject to the following conditions—
(a) the 67[custodian] shall remain responsible in all respects to its client for safekeeping of the 68[goods or] gold kept with such other person, including any associated risks;
(b) all books, documents and other records relating to the 69[goods or] gold so kept with the other person shall be maintained in the premises of the custodian or if they are not so maintained, they shall be made available therein, if so required by the Board;
(c) the 70[custodian] shall continue to fulfill all duties to the clients relating to the gold 71[goods or] so kept with the other person, except for its physical safekeeping.]
Separate custody account.
59 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
60 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
61 Substituted ibid for the words “custodian of securities”.
62 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
63 Inserted by the SEBI (Custodian of Securities) (Second Amendment) Regulations, 2006, w.e.f. 31-10-2006.
64 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
65 Inserted by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
66 Substituted ibid for the word “being” 67 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
68 Inserted by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
69 Inserted ibid.
70 Substituted for the words “custodian of securities” by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
71 Inserted by the Securities and Exchange Board of India (Custodian of Securities) (Amendment) Regulations, 2018, w.e.f. 1-1-2019.
16. Every 72[custodian] shall open a separate custody account for each client, in the name of the client whose securities are in its custody and the assets of one client shall not be mixed with those of another client.
Agreement with the client.
17. Every 73[custodian] shall enter into an agreement with each client on whose behalf it is acting as 74[custodian] and every such agreement shall provide for the following matters namely:─
(a) the circumstances under which the 75[custodian] will accept or release securities 76[, goods]77[, assets or documents] from the custody account;
(b) the circumstances under which the 78[custodian] will accept or release monies from the custody account;
(c) the circumstances under which the 79[custodian] will receive rights or entitlements on the securities 80[or goods] of the client;
(d) the circumstances and the manner of registration of securities in respect of each client; and
(e) details of the insurance, if any, to be provided for by the 81[custodian].
Internal controls.