The Bombay High Court today appointed an arbitrator in a dispute between the National Stock Exchange (NSE) and the Singapore Exchange Ltd (SGX) over the latter's decision to launch nifty-based derivatives.
A vacation bench of Justice S J Kathawalla appointed Justice S J Vazifdar, retired Chief Justice of Punjab and Haryana High Court, as the arbitrator to hear this case.
Justice Kathawalla also asked the arbitrator to try to complete the hearing by June 16.
In the order passed privately in chambers, the bench also restrained SGX from launching the new derivatives till the matter is decided by the arbitrator.
The NSE had approached the high court through senior lawyer Abhishek Manu Singhvi, seeking an injunction against SGX.
Arguing that it had an intellectual property right over the nifty benchmark, NSE sought that the SGX be restrained from going ahead with the launch scheduled for June 4.
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In February, the three Indian stock exchanges---the Bombay Stock Exchange, the NSE and the Metropolitan Stock Exchange---had taken a joint decision to stop trading of derivative contracts based on Indian indices on overseas bourses.
However, on April 11, SGX announced new India equity derivative products that will be based on settlement prices of Nifty Futures contracts.
Derivatives are contracts between two or more parties whose value or prices are determined by the fluctuations of the underlying financial assets such as securities, bonds, currencies, stocks, or market indexes.