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The Forward Markets Commission (FMC) has ordered India’s largest commodity futures exchange, the Multi Commodity Exchange (MCX), to delay no more in reducing the equity of its promoter entity, Financial Technologies India Ltd (FTIL) to below two per cent.
FTIL presently has 26 per cent. On December 17, in the wake of the National Spot Exchange Ltd (NSEL) payments scam, FMC decided FTIL had breached the ‘fit and proper’ requirement to be an anchor investor. For, FTIL was the promoter of NSEL, too.
The MCX board had speedily decided to approve the FMC directive and asked FTIL to comply by January 26. FTIL had then urged MCX not to set any deadline, since it was challenging the ‘fit and proper’ order in the high court here. Now, MCX has told the stock exchanges, FMC has warned it of “appropriate action” if FTIL continues to remain a shareholder of two per cent or more of the paid-up equity capital. That could mean withdrawal of MCX’s licence. MCX has been told by FMC to give the latter a time-bound programme in 10 days for implementation.
Manoj Vaish took charge on Saturday as managing director and chief executive officer of MCX. In his introductory address, he said: “MCX will focus on being a compliance-driven organisation, with best corporate governance practices, and augment development of the commodity ecosystem by unfolding its latent potential.”
