Shutdown over, Sebi back in touch with US regulator

Co-Ordination with CFTC had been affected by American govt Shutdown

The recent government shutdown in the US had affected the Securities and Exchange Board of India (Sebi)’s window to the United States Commodity Futures Trading Commission. With the shutdown over, the window has  been restored.

“We had received communication that they (the US regulator) might not be in a position to respond to queries on account of the shutdown,” said a Sebi official.

Sebi has entered into bilateral agreements for information sharing with a number of regulators. It has also entered into a general agreement with the international body for securities regulators.

According to Sebi’s annual report for the year ended March 2013, it had received 37 requests for information from foreign securities regulators through its information-sharing agreements with the International Organization of Securities Commissions, as well as through bilateral agreements. On its part, Sebi had made nine such requests to other regulators during the same period.

The US Commodity Futures Trading Commission is the commodities market regulator in that country. Its jurisdiction also extends to derivatives such as swap contracts and transactions that involve entities exchanging one security for another due to reasons that include a change in the conditions under which they were bought. Its activities also involved coordination with Sebi, said the Sebi official quoted earlier.

The recent shutdown in the US required a large number of government employees to go on temporary leave, after the legislative body failed to approve the budget that would have paid their salaries, owing to political differences. The impasse was resolved after the shutdown had entered its third week.

During the shutdown, the US Commodity Futures Trading Commission (CFTC) had to work with fewer employees, affecting a number of functions, including enforcement. “The limited staff will only conduct a bare minimum level of oversight and surveillance, and the functions of the division of enforcement will largely cease,” according to a plan for the shutdown released by the government agency.

Among the divisions that were inoperative during the shutdown was the Office of International Affairs, the plan document said.

 “Notwithstanding the limited functions the excepted employees will perform, the vast bulk of CFTC’s operations will cease during a lapse of appropriations. This includes, but is not limited to… all functions of the Office of the Chief Economist, Office of Legislative Affairs, Office of Public Affairs, Office of Diversity and Inclusion, and Office of International Affairs,” it said. Emails sent to CFTC and Sebi for comment did not receive replies.

 

Emails sent to CFTC and Sebi for comment did not receive replies.

Re-establishing Contact

US government shutdown had hit government employees, including those with various regulatory organisations

A number of CFTC employees had to go on temporary leave

It had written to Sebi saying co-ordination affected on account of shutdown

Shutdown ended ended in Mid-October 

Co-ordination has since been restored