Markets regulator Sebi has allowed Spices and Oilseeds Exchange to exit the commodity bourse business as the entity remained non-operational for nearly 10 years.
Spices and Oilseeds Exchange was granted recognition in March 1960, on a permanent basis, for futures trading in turmeric by the government.
However, trading in the exchange has remained discontinued from November 30, 2007. Further, it has not made attempts for revival of trading and has not formulated any revival plan for the purpose of resumption of trading.
The exchange had decided to voluntarily surrender the recognition granted to it as a deemed recognised exchange and had approached the authority in July 2015.
Following this, Sebi, in an order passed on April 12, said Spices and Oilseeds Exchange has complied with the regulator's conditions for exit and is therefore "a fit case to allow exit" from capital markets.
From the valuation report, it is observed that that there are no outstanding liabilities, no contingent liabilities and no tax liabilities pending in the exchange and all deposits of clearing members and brokers have been refunded.
While allowing the exit, Sebi has asked the exchange to comply with tax obligations and not to use the expression "exchange" in its name among others.
According to norms, a commodity exchange is liable to exit the business in case of no trading operation on its platform for more than 12 months.
In addition, commodity exchange is required to ensure that they have at least 5 per cent of nation-wide market share of the commodity, which is principally traded on their platform. In case such exchange fail to meet both the criteria for two consecutive years, it is liable to exit.
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