Saturday July 19, 02:55 AM
FMC's norms to upgrade regional commexes soon
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By Commodities Bureau
Forward Markets Commission (FMC), the commodity markets regulator, is in the process of formulating new guidelines for upgradation of regional commodity exchanges. The new guidelines will facilitate existing regional exchanges to upgrade or change status from regional to national exchanges. "We are preparing guidelines on regional exchanges for upgradation. It will be ready in a month's time," B C Khatua, chairman, FMC, told reporters on the sidelines of MCX Gujarati website launch on Friday. There are 21 regional exchanges registered with FMC. The guidelines would be submitted to the government for further information and clarification. Currently, there are no such guidelines for regional exchanges to upgrade status to a national one. The Forward Contract Regulation Act (FCRA) is being amended to facilitate upgradation of regional exchanges. Khatua said the FCRA would be taken up in the next parliamentary session. The new guidelines will help entities like the Kotak group, which has recently acquired 51% equity stake in 50-year-old Ahmedabad Commodity Exchange (ACE). This regional exchange trades in castor seeds and cottonseed and oil. The Kotak group wants to upgrade the regional exchange to a national one but there are no guidelines for it, he said. Meanwhile, Khatua also said that IndiaBulls has been asked to reduce its stake to 40% from 74% within a month to comply the new guidelines released by the regulator in last May. Indiabulls announced that it would form a joint venture with MMTC to set up a national commodity exchange.
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