Bombay HC adjourns MCX-SX case to Sept 16

The Bombay high court have adjourned the hearing on the MCX-SX versus Securities and Exchange Board of India (Sebi) case to September 16. Friday’s hearing could have been important, as the date for MCX-SX’s licence renewal to operate as a currency exchange is on September 15.

The court had heard both sides but MCX had asked for a few more minutes to argue their case before the judge delivers his verdict. MCX had approached the HC challenging a Sebi order rejecting its application seeking permission to launch equity trading. Sebi had said MCX- SX was not a “fit and proper person”.

Last year, Sebi had renewed MCX’s licence on currency derivatives, citing that the matter was in court. The outcome of the case will have a direct bearing on MCX-SX’s curency trading operations. Currently, it is the leading exchange in currency derivative volumes. The other two exchanges are National Stock Exchange (NSE) and United Stock Exchange (USE).

MCX-SX had started operating in the currency derivatives segment in 2008 and the licence for the sector had since been renewed twice. Sebi had given MCX-SX a year’s extension in September 2010 to offer trading in currency derivatives, even as it awaited the market regulator’s approval to start business in equities.

Sebi, however, decided against giving permission for equity exchange operations to MCX-SX, following apprehensions over its shareholding pattern.