IFSCA notifies International Financial Services Centres Authority (Bullion Exchange) Regulations 2020

IFSCA notifies International Financial Services Centres Authority (Bullion Exchange) Regulations, 2020

Posted On: 13 DEC 2020

International Financial Services Centres Authority

(A statutory authority established by Government of India)

In the Union Budget 2020, Union Minister of Finance Corporate Affairs Smt. Nirmala Sitharaman had made an announcement for setting up an International Bullion Exchange at the International Financial Services Centre in GIFT City, Gandhinagar, Gujarat.

Subsequently, the Government of India had notified the bullion spot delivery contract and bullion depository receipt (with bullion as underlying) as Financial Products and related services as Financial Services under the International Financial Services Centres Authority (IFSCA) Act, 2019.

IFSCA has been entrusted with the responsibility of operationalization of this Exchange. In this regard, International Financial Services Centres Authority (Bullion Exchange) Regulations 2020 were approved by the Authority in its meeting held on October 27,2020. The said regulations have been notified and published in the Gazette of India on December 11, 2020.

The regulations inter alia cover the Bullion Exchange, Clearing Corporation, Depository and Vaults. The regulations are divided into the 16 chapters. First half of the regulation deals with the Exchange and Clearing Corporations while the second half pertains to the Vaults and Depositories and related provisions.

The qualification criteria for grant of membership to the bullion exchange or the bullion clearing corporation, including form of the organisation structure, minimum qualifications and experience of the professional employees, the minimum net worth and financial strength in terms of threshold of key financial ratios, disqualifications, categories of the members and the minimum net worth requirements and the limit, if any, of the volume of trades or clearing or settlement which such member can perform in the bullion exchange or the bullion clearing corporation, the manner in which the applications for the membership shall be processed by the bullion exchange or the bullion clearing corporation, the provisions on avoidance of conflicts, ethical behaviour and conduct of theapplicantsand the members in the business, shall be detailed in the bye-laws of the bullionexchange or the bullion clearingcorporation.

Read the text of the regulation

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