Bombay High Court To Hear Further Arguments In NSE-SGX Case On May 26
The Bombay High Court today granted an extension on the stay of Singapore Exchange Ltd.’s launch of Nifty-based products till Saturday, after the National Stock Exchange of India Ltd. challenged the move.
The NSE and SGX sought a consent order from the high court to start arbitration proceedings in the dispute but could not come to a consensus on the language of the consent order. Senior Advocate Abhisekh Manu Singhvi, representing NSE, argued that the April 11 circular on introduction of these derivatives should not be acted upon until June 4. SGX counsels said this should apply to the launch and not the circular itself.
The high court will continue hearing arguments in the matter on May 26. “Until then, the ad-interim injunction granted on May 21, 2018 continues against the launch of new derivative contracts by SGX, in terms of their above-mentioned circular (issued by SGX on April 11),” NSE said in a press release.
SGX had announced that from June 4 it will start new contracts based on publicly available settlement data after the NSE decided to end its licencing agreement with the Singapore exchange. That came after India’s three stock exchanges decided to stop sharing data with foreign peers to prevent volumes from moving offshore and promote the international trading centre in Gujarat, Prime Minister Narendra Modi’s home state. Index and equity-linked derivatives are used by foreign investors to hedge their risk.
Terming the SGX’s plan a “blatant disregard” of its intellectual property rights and “breach” of the licence agreement, NSE sued the bourse in the Bombay High Court.
During today’s hearing, Justice SJ Kathawala expressed his wish to send the parties to a court-appointed arbitrator to resolve the dispute. The high court also recommended the appointment of Justice SJ Vazifdar (retired Chief Justice of Punjab and Haryana High Court) as the sole arbitrator to decide the matter. The arbitrator can pass necessary and interim orders if the application before him is not decided on or before June 4, the judge said.