FMC panel to probe charges against NBOT
Commodity market regulator Forward Markets Commission on Thursday said it has already set up a committee to probe the alleged irregularities in the demutualisation of the Indore-based regional commodity bourse NBOT.
By PTI |
NEW DELHI: Commodity market regulator Forward Markets Commission on Thursday said it has already set up a committee to probe the alleged irregularities in the demutualisation of the Indore-based regional commodity bourse NBOT.
A fact-finding committee has been set up to assess the complaint filed by the Indore-based Soyabean Processors Association of India (Sopa) against the National Board of Trade (NBOT) over alleged irregularities in the demutualisation process, FMC chairman BC Khatua said.
���The committee, which is still assessing the complaint, will come up with a report soon,��� he said, adding that the dispute between Sopa and NBOT is going on since 2003. In a complaint to the FMC, Sopa has alleged that the NBOT has allotted 100% shares at substantially lower than the market book value to seven companies controlled and floated by NBOT���s chairman... Or his associates during demutualisation.
Demutualisation is the process by which the ownership, management and trading of an exchange are separated. In a demutualised exchange, ownership vests usually with institutional investors, while the management is in the hands of professionals.
Sopa has also sought the dissolution of the NBOT board and urged FMC to nominate new directors, including a new nominee of the regulator who was not with the board of the NBOT earlier.
The NBOT was originally set up by Sopa in 1999, an industry official said. The regional exchange has major strengths in soya oil and soyabean seeds trading. ���We will have to check whether NBOT did its demutualisation in good faith and in conformity with the Forward Contracts Regulation Act, 1952 and the Company���s Act. He added that there were no guidelines either from the government or from FMC on the demutualisation process when NBOT was demutualised.
The regulator, however, said that it would take action, if any, against NBOT after vetting the findings of the committee.
A fact-finding committee has been set up to assess the complaint filed by the Indore-based Soyabean Processors Association of India (Sopa) against the National Board of Trade (NBOT) over alleged irregularities in the demutualisation process, FMC chairman BC Khatua said.
���The committee, which is still assessing the complaint, will come up with a report soon,��� he said, adding that the dispute between Sopa and NBOT is going on since 2003. In a complaint to the FMC, Sopa has alleged that the NBOT has allotted 100% shares at substantially lower than the market book value to seven companies controlled and floated by NBOT���s chairman... Or his associates during demutualisation.
Demutualisation is the process by which the ownership, management and trading of an exchange are separated. In a demutualised exchange, ownership vests usually with institutional investors, while the management is in the hands of professionals.
Sopa has also sought the dissolution of the NBOT board and urged FMC to nominate new directors, including a new nominee of the regulator who was not with the board of the NBOT earlier.
The NBOT was originally set up by Sopa in 1999, an industry official said. The regional exchange has major strengths in soya oil and soyabean seeds trading. ���We will have to check whether NBOT did its demutualisation in good faith and in conformity with the Forward Contracts Regulation Act, 1952 and the Company���s Act. He added that there were no guidelines either from the government or from FMC on the demutualisation process when NBOT was demutualised.
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The regulator, however, said that it would take action, if any, against NBOT after vetting the findings of the committee.
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