Govt Withdraws Recognition of Delhi Stock Exchange
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Posted on:22 Mar 2016 18:00:48
22 March 2016 Current Affairs: The government has formally withdrawn the recognition of Delhi Stock Exchange, more than a year after capital market regulator Sebi derecognised the bourse citing "serious irregularities" in its functioning.DSE was among the few bourses that were given permanent recognition by the Securities and Exchange Board of India (Sebi), as per information available on the regulator's website. Under certain provisions of the Securities Contracts (Regulation) Act, 1956, the recognition to a recognised stock exchange can be withdrawn if it "has not been corporatised and demutualised within the specified time .In August 2005, Sebi had notified DSE Ltd (Corporatisation and Demutualisation) Scheme, 2005. The bourse was to be demutualised on or before the August 28, 2007. Under demutualisation, management and trading at a stock exchange are separated while corporatisation refers to running a bourse like a company. The serious irregularities have been found in the functioning of Delhi Stock Exchange at the time when DSE was taking steps for demutualisation," Sebi Whole Time Member Prashant Saran had said in an order dated November 19, 2014 .The demutualisation process the erstwhile board of DSE had overlooked the due transfer of shares in demat accounts and receipt of funds by the appointed date.
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