Stocks

NCLAT to hear ₹856-cr predatory pricing case against NSE on Oct 10

Our Bureau Mumbai | Updated on January 10, 2018

NSE’s appeal against ₹55.5-crore fine remains pending at the apex court

The ₹856-crore claim by Metropolitan Stock Exchange of India (MSEI) against National Stock Exchange (NSE) will now be heard by the National Company Law Appellate Tribunal (NCLAT) on October 10. MSEI had dragged NSE to the Competition Commission of India (CCI) citing monopolistic practices. The competition watchdog held NSE guilty and asked it to compensate MSEI.

In 2008, both MSEI and NSE launched currency future contracts almost simultaneously. NSE priced the transaction charges on these contracts at zero and given NSE’s dominant position, MSEI was left with no choice but to adopt zero pricing as well.

This made a significant and material dent in the financial position of MSEI, which filed a complaint with CCI alleging predatory pricing (waiver of transaction fees, data-feed fees and admission fees) wherein CCI found NSE guilty and imposed a fine of ₹55.5 crore. NSE filed an appeal with the Competition Appellate Tribunal (COMPAT), which too found NSE guilty.

NSE then moved the Supreme Court and its appeal is still pending.

According to the process, the exchange has filed an application for award of compensation against NSE for ₹856 crore before COMPAT, pending the appeal. Now, as COMPAT ceased to exist (from May 26), all pending matters before COMPAT stand transferred to the NCLAT.

Udai Kumar, MD & CEO of MSEI,said, “MSEI started out as a fast-growing exchange with immense potential, when it was deeply impacted by the financial burden imposed by NSE’s predatory pricing. Speedy disposal of this matter is the need of the hour. “It will encourage transparency and compliance with existing competition laws and practices across the spectrum and also dis-incentivise anti-competitive practises and misuse of dominant position.”

Published on September 26, 2017

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