NSE-SGX licensing pact to continue beyond Aug

Arbitrator asks SGX not to launch its disputed products until the final decision

An arbitrator appointed by the Bombay High Court has directed the National Stock Exchange (NSE) to extend the agreement of Nifty-licensed products to the Singapore Exchange (SGX) until the arbitration concludes. The licensing agreement was to end in August 2018, which could now extend till early 2019.

In an interim order released on Thursday, Justice SJ Vazifdar asked the SGX to abide by the high court’s injunction against the launch of new India derivative products. The injunction will remain in effect for four weeks from the date of the final order.

The hearing in the matter is scheduled for November 21. Both parties have been given time to file their claims and counterclaims within specified timelines, said the order.

“The SGX was directed to refrain from offering new India equity derivatives products such as those announced on April 11,” the exchange said in a statement. “Arbitration proceedings are continuing and the hearings on evidence are expected to commence in early

2019. We will provide updates to the market in due course,” it added.

On May 28, the high court had referred the dispute to the arbitrator after the NSE moved the court, seeking an injunction

against the SGX. The Indian bourse contested the SGX move to launch new products, scheduled for June 4, alleging that those infringed intellectual property.

According to the NSE, the new India products of the SGX were identical to Nifty products licensed to the bourse. Counsel for the NSE had also put forth three terms before the court and the SGX for beginning the arbitration proceedings. These terms included withdrawal of the SGX’s April 11 circular on product launch until the arbitration proceedings were over.

The feud between the NSE and the SGX started after Indian exchanges announced the snapping of ties with their overseas counterparts. The SGX responded that it would launch successor products to its flagship Indian equity derivative products on June 4.

Now the NSE and the SGX have been ordered “to facilitate the continued listing of SGX Nifty products for at least two successive contract month maturations beyond the arbitration’s completion date”, the SGX said.

In an attempt to arrest the migration of traders, the BSE, NSE and Metropolitan Stock Exchange had issued a joint statement in February to stop trading of derivative contracts based on Indian indices on overseas bourses.