The Hindu Business Line : Cross-holding of equity in commodity bourses allowed

NEW DELHI: Commodity bourses MCX, NCDEX and NMCE can now hold equity stake in one another as the Government has allowed cross-holding in national level commodity exchanges that have completed five years.

According to the new guidelines on equity structure issued recently by the Consumer Affairs Ministry, the stock and commodity exchanges can hold a maximum equity of up to 15 per cent in commodity bourses that have completed five years.

This means MCX, NCDEX and NMCE - the three bourses that are over five-year old can now buy equity in one another. However, the combined equity of stock and commodity bourses should not exceed 20 per cent, the guidelines said.

This apart, the government has asked these exchanges to bring their shareholding pattern in line with the new guidelines by September 2010, failing which, they will be liable to lose their national status.

Under the guidelines, these exchanges should not have less than 26 per cent equity from government companies, banks, public financial institutions, co-operative societies, agri-marketing federations and private warehousing companies.

However, commodity market regulator Forward Markets Commission (FMC) is empowered to give an extension for a further period of one year. - PTI

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