(1) The appointment, renewal of appointment and termination of service of the managing director of a recognised stock exchange or a recognised clearing corporation shall be subject to the prior approval of the Board.
(2) Every recognised stock exchange or recognised clearing corporation shall, subject to the guidelines issued by the Board from time to time, determine the qualification, manner of appointment, terms and conditions of appointment and other procedural formalities associated with the selection/ appointment of the managing director.
(3) The appointment of the managing director shall be for a term not exceeding five years:
Provided that post the completion of the first term, the recognized stock exchange or the recognized clearing corporation shall conduct the appointment process for appointment of the Managing Director afresh:
Provided further that a person may be appointed as the Managing Director by the recognized stock exchange or recognized clearing corporation for a maximum of two terms not exceeding five years each, subject to a maximum age limit of sixty five years.
(4) The Managing director of a recognised stock exchange or a recognised clearing corporation shall not—
(a) be a shareholder or an associate of a shareholder of a recognised stock exchange or recognised clearing corporation or shareholder of an associate of a recognised stock exchange or recognised clearing corporation, as the case may be;
(b) be a trading member or a clearing member or his associate and agent or shareholder of a trading member or clearing member or shareholder of an associate and agent of a trading member or a clearing member; or
(c) hold any position concurrently in the subsidiary of a recognised stock exchange or a recognised clearing corporation or in any other entity associated with a recognised stock exchange or a recognised clearing corporation:
Provided that the Managing Director of a recognised stock exchange may be appointed on the governing board, but not as managing director, of the subsidiary of a recognised stock exchange or a recognised clearing corporation.
(5) The Managing Director shall be liable for removal or termination of services by the governing board of the recognised stock exchange or recognised clearing corporation with the prior approval of the Board for failure to give effect to the directions, guidelines and other orders issued by the Board or the rules, the articles of association, bye-laws and regulations of the recognised stock exchange or the recognised clearing corporation.
(6) The Board may suo motu remove or terminate the appointment of the managing director if deemed fit in the interest of securities market:
Provided that no managing director shall be removed unless he has been given a reasonable opportunity of being heard.
(7) The conditions specified under this regulation for appointment of directors shall be applicable to a person holding position as managing director in a stock exchange or a clearing corporation on the date of commencement of these regulations.
Explanation: For the purpose of sub-regulation (7), the applicability shall be determined post the completion of the existing term and the prior term(s) completed by a managing director on the governing board of a recognized stock exchange or a recognized clearing corporation shall also be considered while determining the eligibility.
Code of Conduct for directors and key management personnel