'Brokers trading in futures exchanges should register'

The regulator of the commodity market Forward Markets Commission (FMC) "" has proposed that all intermediaries that trade on the futures exchanges should compulsorily register with it.

S Sundareshan, chairman of FMC, at the launch of the agri-composite index by the National Commodities and Derivatives Exchange of India (NCDEX), said, "This is to ensure that there is no malpractice in the market at the intermediary level, and the draft guidelines for the registration process have already been prepared."

He added that this was only a regulatory mechanism and not intended for revenue generation. The FMC already has the power to check the account books of intermediaries and the regulator plans to exercise this right more frequently, Sundareshan said.

In addition, registering with the FMC would ensure that the intermediaries deal directly with the regulator. Besides, the regulator also plans to monitor the market in a more professional manner.

"Every week senior officers of the exchanges will meet with the regulator to discuss the price movements to keep a check on the volatility," he said.

Sundareshan also expressed concern over the delivery mechanisms that all the exchanges are working hard to perfect as well as the issue of the final price on the day of the settlement.

He also addressed issues regarding how to develop regional exchanges and improve their methods of functioning and create a level playing field with the national exchanges.

The chairman also commented on the relatively peaceful coexistence of the national level exchanges, and their prudent and transparent practices without impinging on each others territory.