JOIN USCrisis-hit MCX has been given 10 days to submit a time-bound action plan to comply with regulator FMC’s order that directed the bourse to ensure its promoter FTIL cuts stake to two per cent or below from 26 per cent.
On December 17 last year, the FMC had issued an order, declaring Financial Technologies India Ltd (FTIL) and its chief Jignesh Shah unfit to run any exchange, including the MCX, following a Rs 5,600-crore payment crisis erupting at group company National Spot Exchange Ltd (NSEL).
In an 80-page order, FMC held that FTIL is not ‘fit and proper’ to hold anything more than 2 per cent shareholding in the MCX, the country’s leading commodity bourse.
In a BSE filing, MCX informed that it has received a letter from the Forward Markets Commission (FMC) directing the bourse to “take immediate and effective steps to implement the Order of the Commission dated December 17, 2013.”
“The company has been asked to submit to FMC a time bound program for implementation of the aforesaid order within 10 days of receipt of FMC letter,” the filing added.
On December 26, the MCX Board had asked FTIL to reduce its stake to 2 per cent, in accordance with the FMC order.
Meanwhile, FTIL and Shah have already moved the Bombay High Court, challenging the FMC order. The case is scheduled for hearing next week.
The NSEL, which is promoted by FTIL, has been defaulting on payments to 13,000 investors. It plunged into the payment crisis after halting trading in commodities from late July last year on a government directive.
Manoj Vaish took charge on Saturday as Managing Director and CEO of MCX. Commodity markets regulator "FMC has conveyed its approval to the appointment of Dr Manoj Vaish as MD and CEO of the company. Accordingly, Vaish has joined the company with effect from February 1, 2014," MCX said in a BSE filing.
Vaish was the Managing Director of NSDL Database Management before joining the MCX.
He was an executive director of the BSE between 1998 and 2004 and CEO of financial services research firm Dun & Bradsheet.Management, sources said.MCX shares settled at Rs 499.45 on Friday, up 4.13 per cent from the previous closing day on the BSE.