Commexes asked to keep 5% of revenue for settlements

Bourses will also have to transfer all related penalties charged from members to Settlement Guarantee Fund by September 1

The Forward Markets Commission  (FMC) on Friday directed all six commodity futures exchanges to transfer five per cent of their gross revenues of each year to their Settlement Guarantee Fund (SGF), with effect from 2007-08 or from the date the exchange was set up till 2012-13, subject to a minimum of Rs 10 crore. They must comply by August 31.

FMC had first asked the exchanges to constitute an SGF in 2007. In the earlier orders, the margin money was also included. An exchange official said the regulator had decided to exclude this component, making the burden modest.

The latest directive comes as National Spot Exchange Ltd faces a default crisis. It had Rs 800 crore worth of SGF as of July but a large part of this was only margins paid by members. There's only about Rs 62 crore in its fund now.

The exchanges shall also have to transfer all settlement-related penalties charged by them from members to the fund by September 1.

As of this Tuesday, members of the Multi-Commodity Exchange had deposited collateral of Rs 2,640 crore consisting of cash margin, fixed deposit receipts, warehouse receipts, securities and bank guarantees with the exchange, beside the base minimum capital deposit. MCX has Rs 1,200 crore of reserves and will now have to set aside around Rs 140 crore from this for the SGF.