An employee walks along a pathway at the National Stock Exchange (NSE) in Mumbai, India (Photographer: Dhiraj Singh/Bloomberg)

NSE-SGX Dispute: Final Decision On Arbitration Process Likely By February 2019, NSE Says

The National Stock Exchange today said a final decision is expected by the first week of February 2019 on the arbitration proceedings with Singapore Exchange regarding launch of new derivative products linked to its indices.

Both bourses are locked in a tussle after Singapore Exchange, in April, announced listing of new Indian equity derivative products from June.

According to the minutes of the eighth meeting of the tribunal on June 18, the final hearing will take place between Jan. 14 and Feb. 2, 2019. The arbitrator has proposed that the final order could be delivered within a week after the matter is heard, a source close to the development told BloombergQuint.

Besides, the arbitrator has given further directions to dispose the matter in a time-bound manner.

  • Nov. 19: NSE would file an affidavit based on factual aspects of the case presented by the prime witnesses, along with evidence provided by an expert agency on Indian derivatives market
  • Nov 19: SGX would file an affidavit only based on evidence provided by the expert
  • Dec. 10: Both parties, on or before this date, would be allowed to file affidavits based on rebutting expert evidence
  • Jan 14 - Feb. 19: Matter to be finally heard between 11 am - 5 pm at a venue decided by both the parties

Last week, an arbitral tribunal restrained the SGX from launching any new derivative products linked to NSE's indices. However, it allowed continuation of existing SGX-Nifty contracts.

Also read: NSE-SGX Arbitration Order Unlikely This Year

Against this backdrop, the NSE today said the "tribunal has fixed the final dates for arbitration and the award is expected by the first week of February, 2019".

Amid concerns over liquidity migrating overseas, the NSE’s index company IISL had moved the Bombay High Court, which restrained SGX from launching the new products and referred the matter for arbitration.

According to the release, the injunction against the launch of new products, first imposed by the Bombay High Court, continues.

"SGX has been restrained from launching or listing any new derivative products linked to IISL Indices or NSE and NSE IFSC equity derivative products for a period of three weeks from the final arbitration award,” the release said. "The existing license for the SGX Nifty contracts will stand extended for two successive contract months beyond the final arbitration award," it added.

On June 16, the SGX said the arbitration proceedings are continuing and the hearings on evidence are expected to commence in early 2019.

In a statement, the SGX had also said that it has been granted a licence extension to continue the listing and trading of SGX Nifty contracts beyond August 2018.

The arbitration is between India Index Services and Products Ltd and Singapore Exchange Derivatives Trading Ltd. and others. Proceedings are going on before Justice Vazifdar, former Chief Justice of the Punjab and Haryana High Court.

(This copy has been modified to include the timeline for the hearing.)