The Hindu Business Line : FMC plans uniform working system for commodity bourses

THE Forward Market Commission (FMC), the regulatory body for the commodities exchanges, is expected to draw up a set of directives for the smooth and uniform functioning of all the three major national commodity exchanges of the country — the National Multi-Commodity Exchange (NMCE), the Multi-Commodity Exchange (MCX) and the National Commodity and Derivative Exchange of India (NCDEX).

The FMC held an informal meeting with the three national commodity exchanges to discuss various issues. The regulator made some suggestions to the officials of the exchanges to enhance their trading activities.

"It was a routine kind of a meeting with the three exchange chiefs. We discussed a number of issues related to their day-to-day functions. We will come out with specific directions for the uniform working system of these exchanges soon," Dr Kewal Ram, Chairman of FMC, told Business Line.

The steps to be taken for uniform working system for the three national exchanges will be gross margin system, promotion and marketing, exchange timing and client level monitoring and surveillance system.

"We will give some time to the exchanges to migrate from the present practice to the new one as they may have to do some modification in the software," he said.

On the issue of competitiveness among the exchanges, Dr Kewal Ram said: "We have advised the three exchanges that they have the right to project and promote themselves, but they should not indulge in bad practices. If such an issue arises, we will redress immediately."

"We have suggested that there should be uniform timing for commodities trading and; late session trading could be restricted to four commodities only i.e. gold, silver, cotton and soya," he said.

The agency also suggested that first session timing could be restricted to 10 a.m. to 5 p.m.

After a break of a half-an-hour, commodity trading for four commodities could be restricted to 5.30 to 11.30 pm.