 "FMC to complete all probes ahead of Sebi merger")
The Forward Markets Commission (FMC) will have to complete all pending investigations before its merger with the securities market regulator, Securities and Exchange Board of India (Sebi).
According to sources, this is one of the key conditions put by Sebi, working to ensure a smooth transition from being a stock market regulator to one for commodities, too.
The commodities regulator is being merged with Sebi following an announcement in the Union budget, in February.
ALSO READ: Sebi-FMC merger to delay exchange IPOs
Some of the important pending investigations with FMC are the matters involving Multi Commodity Exchange, Universal Commodity Exchange and the National Commodity and Derivatives Exchange contract default.
Sebi says before formal notification of a merger, FMC must complete all these and maintain a database of all the action initiated. The notification is expected in September. Discussion over the merger is likely to be one of the key items on the agenda for Sebi’s next board meeting, slated for June-end.
Sebi is ironing out issues related to surveillance and is working on realigning the risk management framework for the commodities market with its own.
Sebi has also sought approval from the ministry of finance for hiring close to 90 personnel at various levels, “due to the wider scope of Sebi functions as compared to that of FMC like broker regulation, market surveillance and investigation”, said an official.
The merger is being monitored by a finance ministry committee headed by Ajay Tyagi, additional secretary, and a Sebi-constituted panel.
A separate Sebi department will be created for carrying out the functions on the commodity derivatives market. This would be similar to Sebi’s market regulation department. Additionally, a few divisions would be created within Sebi’s surveillance, legal and investigation departments for regulating the commodity futures market. Sebi is also asking FMC officials if they wish to join it.
In February–March, the regulator would do another assessment of the personnel required to carry out commodities market-related functions.
Sebi is also likely to make it mandatory that any commodity exchange (comex) have a net worth of at least Rs 100 crore. Ace Derivatives and Commodity Exchange and National Multi Commodity Exchange of India do not have this much.
After the merger, Sebi would put in place a policy framework on non-functional comexes. FMC has been issuing showcause notices to these. In the case of national exchanges, the markets regulator would grant six months to a year to comply with Sebi regulations.
SEBI-FMC MERGER
According to sources, this is one of the key conditions put by Sebi, working to ensure a smooth transition from being a stock market regulator to one for commodities, too.
The commodities regulator is being merged with Sebi following an announcement in the Union budget, in February.
ALSO READ: Sebi-FMC merger to delay exchange IPOs
Some of the important pending investigations with FMC are the matters involving Multi Commodity Exchange, Universal Commodity Exchange and the National Commodity and Derivatives Exchange contract default.
Sebi says before formal notification of a merger, FMC must complete all these and maintain a database of all the action initiated. The notification is expected in September. Discussion over the merger is likely to be one of the key items on the agenda for Sebi’s next board meeting, slated for June-end.
Sebi is ironing out issues related to surveillance and is working on realigning the risk management framework for the commodities market with its own.
Sebi has also sought approval from the ministry of finance for hiring close to 90 personnel at various levels, “due to the wider scope of Sebi functions as compared to that of FMC like broker regulation, market surveillance and investigation”, said an official.
The merger is being monitored by a finance ministry committee headed by Ajay Tyagi, additional secretary, and a Sebi-constituted panel.
A separate Sebi department will be created for carrying out the functions on the commodity derivatives market. This would be similar to Sebi’s market regulation department. Additionally, a few divisions would be created within Sebi’s surveillance, legal and investigation departments for regulating the commodity futures market. Sebi is also asking FMC officials if they wish to join it.
In February–March, the regulator would do another assessment of the personnel required to carry out commodities market-related functions.
Sebi is also likely to make it mandatory that any commodity exchange (comex) have a net worth of at least Rs 100 crore. Ace Derivatives and Commodity Exchange and National Multi Commodity Exchange of India do not have this much.
After the merger, Sebi would put in place a policy framework on non-functional comexes. FMC has been issuing showcause notices to these. In the case of national exchanges, the markets regulator would grant six months to a year to comply with Sebi regulations.
SEBI-FMC MERGER
- FMC to complete all pending investigations before the merger
- Sebi seeks 90 new officials
- Sebi to align surveillance and risk management framework for commodities market with its framework
- Sebi will create separate department with four divisions for commodity market regulations
- Would do another assessment of the personnel required in February-March
- Sebi also likely to mandate that any national commodity exchange have a net worth of Rs 100 crore