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NSE-SGX's fail to arrive at consensus over invoking arbitration clause

Bombay High Court extends interim injunction till May 26

Shrimi Choudhary  |  Mumbai 

NSE

After over 10 hours of arguments at the Bombay High Court on Wednesday, the (NSE) and (SGX) failed to arrive at a consensus with regard to an The argument will resume at the court’s vacation bench led by Justice SJ Khathawala on May 26.

“The injunction order has been extended till Saturday. Meanwhile, we would explore all option to arrive at a consensus to obtain an arbitration order from the high court,” said counsel.

This is after filed a lawsuit against the overseas bourse for an interim injunction on the new products.

“After hearing both parties briefly, the Court granted an injunction against the launch of the new derivative contracts by The matter was heard by the Court and has been kept for further detailed arguments on Saturday. Until then, the ad-interim injunction granted on May 21, continues,” said in a statement. was set to launch trading in new India products from June 4.

During the long-day hearing, NSE counsel Abhishek Manu Singhvi and Vivek Menon put forth three terms before the high court and for beginning the An arbitration process typically uses a middleman or arbitrator to settle the dispute.

These terms include withdrawal of SGX’s April 11 circular on product launch until the are disposed of. Another one is to put court order on the SGX website so that investors should know that matter is sub judice. SGX has to mention about the HC order in the agreement, marketing materials and notifications.

Responding to this, SGX’s senior counsels Sriraz P Rustomjee and Gaurav Joshi contested the terms saying there is no threat to NSE till 4 June and such conditions would be extortion on our clients.

He further asked why to put circular on stay when product is to be launched on June 4. However, the SGX proposed that they are willing to deposit $3 million as bank guarantee with NSE.

During the agrument, Singhvi informed court NSE and SGX had a several rounds of discussion over the new products, where concerns were raised over them being a replica of Nifty products. Despite the concerns, SGX went ahead with the new products, he said.

Sources say that NSE, in the petition, mentioned that SGX’s India futures and option (F&O) is a case of piracy and it violates copyright and intellectual property Acts.

The enables interim measures of the protection among jurisdictions. Accordingly, the aggrieved party can approach the courts for securing rights at the time of the dispute. The clause is applicable even if the contract is terminated.

The high court admitted the matter on Tuesday and restrained the from launching new derivative contracts until further notice.

In April, SGX announced listing of new products during June. Following the development, NSE had said it was examining the SGX announcement and had also sought more details regarding the proposed products from the foreign bourse.

In February, leading stock exchanges BSE, NSE and Metropolitan Stock Exchange of India announced their decision to stop providing data feeds to overseas exchanges as part of a joint effort to stymie migration of liquidity to overseas after SGX introduced trading in single-stock futures of Nifty 50 companies.

First Published: Wed, May 23 2018. 23:47 IST
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