SEBI Sets Framework For Exchanges, Clearing Corporations At IFSC
A domestic or foreign bourse can set up an exchange in the IFSC with at least 51 percent stake.
- Domestic or foreign bourse can set up an exchange in IFSC with at least 51 percent stake.
- Remaining 49 percent stake can be held by other exchanges or banks with an individual cap of 15 percent.
- Insurers, commodity derivative exchanges, public financial institutions can also hold remaining shares.
- Same rules will be applicable to clearing corporations keen on operating at the IFSC.
A domestic or foreign bourse can set up an exchange in the IFSC with at least 51 percent stake while the remaining can be held by other exchanges or banks, among others, with an individual cap of 15 percent.
The Securities and Exchange Board of India (SECI) said insurers, commodity derivative exchanges, public financial institutions of Indian jurisdiction are also eligible to hold the remaining shares.
In a circular, the regulator said any one of these entities may "acquire or hold, either directly or indirectly, either individually or together with persons acting in concert, up to 15 percent of the paid-up equity share capital of such stock exchange (new venture)".
Under the IFSC regime, any recognised domestic or foreign stock exchange can set up a subsidiary in the international financial services centre (IFSC) to offer services, provided they hold at least 51 percent stake in the venture.
The same rules will be applicable to clearing corporations keen on operating at the IFSC. Any India registered depository may set up a branch – IFSC Depository Services – at the IFSC after prior approval, the markets regulator said.
"Such Indian depository shall be required to ringfence its domestic operations, financially, operationally and technologically, from its operations at the IFSC," SEBI said.
For foreign depositories seeking to operate at the IFSC, the regulator said such entities can form a subsidiary to provide the services at the IFSC where at least 51 percent should be held by such depository and the remaining shares may be offered to any other registered depository or stock bourse or clearing corporation, whether Indian or of foreign jurisdiction.
"Any SEBI registered intermediary (except trading member or clearing member) or its international associates in collaboration with such SEBI registered intermediary may provide financial services relating to the securities market, at the IFSC, without forming a separate company, subject to the prior approval of the board," the regulator said.
The parent depository or stock exchange or clearing corporation will be responsible for the governance of these subsidiaries at all times.