 "The logo of the Securities and Exchange Board of India (SEBI), India's market regulator, is seen on the facade of its head office building in Mumbai")
The Securities and Exchange Board of India (Sebi) today clarified that commodity specific businesses will also be allowed to become member of exchanges, post the merger.
This comes as an important clarification for the market which was awaiting clarity on whether traders and business houses are eligible to apply for Sebi registration.
In a set of frequently asked questions Sebi today said that traders and business houses can also register as members of commodity exchanges.
"A member of the commodity derivatives exchange can do the Business in goods related to the underlying and also do incidental to or consequential to trades in commodity derivatives," said the Sebi release.
This means that gold jewelers can obtain registration from Sebi provided that they are in compliance with the exchange bye-laws and Sebi requirements.
"This is significant clarification by the Sebi because there were apprehensions among brokers that those having businesses other than commodity derivatives may not be allowed to become members of exchanges under Sebi's regulations. This will process smooth for members," said P K Singhal, Joint MD of MCX.
Another important clarification by Sebi is that the registration application processing at SEBI would be decentralized. And trading members of commodity markets can obtain registration at the regional Sebi offices.
The commodity brokers can register with Sebi from today. The registration window has been kept open for three months,
Sebi reiterated that the networth requirement of Rs 1 crore and the registration fees of Rs 50 lakh would need compliance after a year.
