India’s National Stock Exchange sues market regulator to access $817 million corpus

© Reuters. FILE PHOTO: A security guard walks past the logo of the National Stock Exchange (NSE) inside its building in Mumbai, India, May 28, 2019. REUTERS/Francis Mascarenhas

BENGALURU (Reuters) – The National Stock Exchange of India is suing the country’s market regulator to get access to 60 billion rupees ($816.77 million) of its revenue deposited into a separate account for over four years, the Economic Times reported https://economictimes.indiatimes.com/markets/stocks/news/nse-approaches-sat-to-access-over-6000-cr/articleshow/82619623.cms on Friday, citing people with knowledge of the matter.

In September 2016, the Securities and Exchange Board of India (SEBI) had asked the NSE to deposit revenue generated from offering co-location services into a separate account and had barred it from using those funds, the report said.

Brokerages can rent data racks in the exchange itself from co-location frameworks, allowing them quicker access to exchange servers.

In April 2019, SEBI said https://www.reuters.com/article/india-sebi-nse-idUSL3N22C416 it did not have enough evidence that the NSE committed a fraudulent and unfair trade practice but it had established the exchange did not exercise due diligence when putting in place the co-location servers.

The stock exchange has moved the Securities Appellate Tribunal to get permission to withdraw money from the account, according to the report.

The NSE also wants the tribunal to pass an order discontinuing the need for the bourse to put its co-location revenues into a different account, the report added. The tribunal is set to hear the matter on May 17.

SEBI and NSE did not immediately respond to Reuters’ requests for comments.

($1 = 73.4600 Indian rupees)

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