In the long-running tussle between the National Stock Exchange (NSE) and its younger rival MCX-SX, the Competition Commission is believed to have penalised NSE for abusing its dominant market position.
As a penalty, NSE has been asked to pay five per cent of its average annual turnover and also "cease and desist" of unfair trade practices in the currency derivative trading, sources said.
According to the order, NSE has to stop subsidising its currency derivatives operations and refrain from pursuing any anti-competitive practices. While sources said CCI passed the order this evening, an NSE official said they have not got any order yet. Along with the CCI order on May 25, the commission had issued a notice to the bourse before quantifying the penalty.
Last month's order was passed with a majority vote of five members of the seven-member commission. Two members, Anurag Goel and Geeta Gouri, had dissented, where NSE was found guilty of abusing its market dominance and following unfair trade practices in the currency derivatives market.
However, CCI had already made its stand clear that the dissent note of the two members, which has been issued according to a court direction pursuant to a petition filed by NSE, would not affect its ruling, as a majority order is considered enforceable under the regulations.
NSE entered currency derivatives in August 2008, followed by MCX-SX in October 2008 and later by USE in September 2010.
The CCI order came after a year-long probe by CCI, which began after MCX-SX filed a complaint on November 16, 2009. The CCI sought a detailed probe into the matter by its director general, which submitted its report in September 2010.
After the DG's report found NSE guilty of anti-competition practices, the CCI conducted further inquiry with various parties and issued a showcause notice to NSE on April 29 and the majority order on May 25.
The matter had also reached Delhi High Court after the NSE approached the court with a plea that it could reply to the notice only after reviewing the complete order.
