Fit and proper requirements

9. (1) The applicant and its principal officer, directors/ partners/ designated partners, key managerial personnel and controlling shareholders shall be fit and proper persons, at all times. (2) For the purpose of sub-regulation (1), a person shall be deemed to be a fit and proper person if :- (a) such person has a record of fairness and integrity, including but not limited to- (i) financial integrity; (ii) good reputation and character; and (iii) honesty. (b) such person has not incurred any of the following disqualifications – (i) the person has been convicted by a court of law for any offence involving moral turpitude or any economic offence or any offence against securities laws; (ii) charge sheet has been filed against such person by any Indian enforcement agency in matters concerning economic offences and is pending; (iii) charges have been framed by a court of law or an equivalent institution in matters concerning economic offences; (iv) a recovery proceeding has been initiated against the person by a financial regulatory authority and is pending; (v) an order for winding up has been passed against the person for malfeasance; (vi) the person has been declared insolvent and not discharged; (vii) an order restraining, prohibiting or debarring the person from accessing or dealing in financial product(s) or financial service(s), has been passed by any regulatory authority, in any matter concerning securities laws or financial services market and such order is in force; (viii) any other order against the person, which has a material bearing on the securities market, has been passed by the Authority or any other regulatory authority, and a period of three years from the date of the order has not elapsed; Explanation. – For the above provision, the decision to determine materiality shall be that of the Authority. (ix) the person has been found to be of unsound mind by a court of competent jurisdiction and the finding is in force; (x) the person is financially not sound or has been categorized as a wilful defaulter; (xi) the person has been declared a fugitive economic offender; or (xii) any other disqualification as may be specified by the Authority. (3) Where any person has been declared as not ‘fit and proper person' by an order of a regulatory authority, such a person shall not be eligible to apply for any registration, until she satisfies the fit and proper criteria.