Govt looking at merging FMC with Sebi

Move aimed at closely monitoring commodities market

The government is considering a proposal to merge the Forward Markets Commission (FMC) with the capital market regulator Securities and Exchange Board of India (Sebi) to ensure better monitoring of the commodity futures market.

“One option being considered by the government is merging FMC with Sebi,” said a senior finance ministry official.

Alternatively, the official said, the government might also pursue the long-pending proposal to give more powers to FMC by amending the Forward Contracts Regulation Act (FCRA) Amendment Bill.

While FMC is the regulator for commodities trading, Sebi regulates the capital markets.

The move would also help improve the regulatory architecture for the future commodity trading. Earlier, the Financial Sector Legislative Reforms Commission had recommended that Sebi, the Insurance Regulatory and Development Authority, Pension Fund Regulatory and Development Authority and FMC be merged into a single entity into a unified financial agency.

In September 2013, the government had brought FMC under the ambit of the finance ministry in the aftermath of a Rs 5,600-crore payment crisis at National Spot Exchange. FMC was earlier under the consumer affairs ministry.