According to official sources, with the passage of the current Lok Sabha, the Bill will anyway expire and it has to be tabled again. However, the government in principle agreeing to toe the recommendations of the Financial Sector Legislative Reforms Commission ( FSLRC), there is need to decide whether a new bill is required or the reforms could be brought in a different manner , given the convergence model for the regulatory structure of the commodities market regulator under FSLRC.
Amendments to the Forward Contracts (Regulation) Act, 1952 (FCRA) will seek to give more powers to the commodities market regulator, Forward Market Commission (FMC), and open the door for introduction of new products like options and indices trading in the commodities futures market.
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The new financial regulatory structure as per the proposal of the FSLRC will be governed under Financial Regulatory Architecture Act, which will set out the work allocation across different agencies. Under this framework, changes in work allocation will not require changes to underlying laws.
The proposed regulatory architecture has brought down the eight agencies in the present financial framework to seven by merging Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority (IRDA), Pension Reforms Regulatory and Development authority (PFRDA) and Forward Markets Commission (FMC) into one body - Unified Financial Regulatory Agency. The commission recommends converting Deposit Insurance and Credit Guarantee Corporation into a new body called Resolution Corporation and Securities Appellate Tribunal to be changed to Financial Securities Appellate Tribunal, which will hear appeals against all financial regulatory agencies including RBI. The commission recommends Financial Stability and Development Council (FSDC) to continue as it is. Two new entities have been proposed - Debt Management Office, carved out of RBI and Financial Redressal Agency (FRA).
Given that, the new cabinet would be required to rework the structure for the commodities market, both in terms of regulatory model and legal premise. Therefore FCRA Bill in the present form may not serve the purpose if the FSLRC recommendations have to be complied with in principle, said official sources. They added that another option may be to rework the FCRA Bill itself by amalgamating it with the recommendations of the FSLRC but it may change the shape of the bill and its status and structure. .
In a last minute effort, the Finance Ministry has put up a notice in Lok Sabha for tabling the Forward Contracts Regulation Act 1952 in the vote on account session in the month of February. However it could not be tabled.
The standing parliamentary committee on food and consumer affairs in its report on the FCRA bill recommended for giving full autonomy to the Forward Markets Commission (FMC), in line with that enjoyed by the Securities and Exchange Board of India for the capital market and had consented to forward trading in essential commodities.