The Securities and Exchange Board of India (SEBI) on September 09, 2026, issued a circular regarding the review of Position Limits for Clients and Penalty Provisions for Violation / Breach of Position Limits for the Commodity Derivatives Segment.
The following has been stated: -
•SEBI has revised the position-limit and penalty framework for the Commodity Derivatives Segment to ease compliance and address stakeholder concerns.
•Penalties for client-level position-limit violations are now linked to the extent and duration of the breach, with specified monetary caps, while continued breaches may lead to compulsory square-off of excess positions.
•Repeated violations may attract additional penalties and a one-day square-off mode for the trading member, with repeated serious breaches potentially inviting SEBI action.
•The definition of “Broad Commodity” is revised to include agricultural commodities having average deliverable supply of at least 10 lakh MT or ₹5,000 crore over the past five years.
•Client-level position limits are set at 2% for Broad, 1% for Narrow, and 0.5% for Sensitive commodities, with transitional treatment for commodities moving to the Broad category.
[Circular No.: HO/47/16/13(5)2026-MRD-POD1/ I/20735/2026]
