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NSE-SGX Arbitration: Bombay High Court Grants Time Till Dec. 31, 2020 For Final Order

The dispute stems from NSE’s decision to terminate its data-sharing pact with the Singapore partner.

The National Stock Exchange Ltd. building with the new logo  in Mumbai (Photographer: Vishal Patel/BloombergQuint)
The National Stock Exchange Ltd. building with the new logo in Mumbai (Photographer: Vishal Patel/BloombergQuint)

The Bombay High Court deferred the final decision in the National Stock Exchange’s arbitration with Singapore Exchange till Dec. 31, 2020, allowing the foreign partner to continue with single-stock Nifty 50 futures that had triggered the dispute about a year ago.

The arbitrator—in agreement with both the parties—was given an extension “to decide the dispute between the parties and pass his award”, said an order signed by Bombay High Court Judge SJ Kathawalla on March 13.

Multiple extensions have already been granted in the matter by the arbitrator. The parties were first given an additional one year from the first hearing on May 29, 2018, a person close to the development told BloombergQuint seeking anonymity since he is not authorised to speak to the media. Both the sides then approached the arbitrator and got another six months till November 2019, he said, adding that the arbitrator has now been given time till Dec. 31, 2020 for the final hearing.

While the grounds for granting the latest extension weren’t mentioned in the order, the person cited earlier said it was done as the market regulators of India and Singapore are in talks for a settlement and collaboration on GIFT City, the international finance hub in Prime Minister Narendra Modi’s home state Gujarat.

The dispute between the exchanges stems Singapore bourse’s decision to offer single-stock Nifty 50 futures—which drive 85 percent of the segment turnover for India’s largest exchange. Along with two other domestic exchanges, the NSE decided to stop sharing pricing data with foreign peers to prevent volumes from shifting overseas and promote trading by foreign investors through GIFT City.

The Indian bourse took its Singapore peer to court after the SGX, despite its partner’s decision to terminate of contract, launched equity derivatives based on publicly available prices. The Bombay High Court granted an interim stay on the new products and asked the parties to appoint Justice SJ Vazifdar as the arbitrator.

The arbitrator, in a June 2018 interim order, said while SGX will not be allowed to launch any equity derivatives linked to the NSE indices during the arbitration period and three weeks after the final order, the existing licence could continue between the exchanges for two successive contract months beyond the final arbitration award.