Regulation of Commodity Derivatives Market
The provisions of Part I (excluding Section 132) and Part II of Chapter VIII of the Finance Act, 2015 came into force w.e.f. September 28, 2015 and the provisions of Section 132 of the Act came into force w.e.f. September 29, 2015 in terms of Central government notifications F. No. 1/9/SM/2015 S.O. 2362 (E) and F. No. 1/9/SM/2015 S.O. 2363 (E)dated August 28, 2015.
As a result, Securities and Exchange Board of India (SEBI) commenced regulating the commodity derivatives market under Securities Contracts Regulation Act (SCRA) 1956 with effect from 28th September, 2015 and the Forward Contracts Regulation Act (FCRA) 1952 got repealed with effect from 29th September, 2015.
To fulfil this additional responsibility of regulating the commodity derivatives market, SEBI has created the following additional departments/divisions:
| S.No. | Department | Division | |
| 1 | Commodity Derivatives Market Regulation Department (CDMRD) | (i) | Exchange Administration |
| (ii) | Market Policy | ||
| (iii) | Risk Management and Products | ||
| (iv) | Exchange Inspection and Complaints against Exchanges | ||
| 2 | Market Intermediaries Regulation & Supervision Department (MIRSD) | (i) | Commodity Derivatives Division – 1 |
| (ii) | Commodity Derivatives Division – 2 | ||
| 3 | Integrated Surveillance Department (ISD) | (i) | Commodity Derivatives Division – 1 |
| (ii) | Commodity Derivatives Division – 2 | ||
| 4 | Investigations Department (IVD) | (i) | Commodity Derivatives Division |
| 5 | Department of Economic Policy and Analysis (DEPA) | (i) | Commodity Research (Agriculture) |
| (ii) | Commodity Research (Non Agriculture) | ||
| 6 | Legal Affairs Department (LAD) | (i) | Division of Policy and Regulatory Affairs for commodity Derivatives |
| (ii) | Division of Regulatory Assistance for Commodity Derivatives | ||
| 7 | Enforcement Department (EFD) | (i) | Enforcement Division for commodity Derivatives – 1 |
| (ii) | Enforcement Division for commodity Derivatives – 2 | ||
The organisational structure of SEBI and the functions of departments/divisions is available on SEBI website.
Part I of the Finance Act, 2015 provides that “All rules, directions, guidelines, instructions, circulars, or any like instruments, made by the Commission or the Central Government applicable to recognized associations under the Forward Contracts Act shall continue to remain in force for a period of one year from the date on which that Act is repealed, or till such time as notified by the Security Board, whichever is earlier, as if the Forward Contracts Act had not been repealed.”
The Act also provides that all recognised associations under FCRA shall be deemed to be recognised stock exchanges under the SCRA. Accordingly, the following recognised associations shall be deemed to be recognised stock exchanges under SCRA w.e.f. September 28, 2015:
| S.No. | Name of the Exchange |
| 1 | Ace Derivatives and Commodity Exchange Limited, Mumbai |
| 2 | Bombay Commodity Exchange Ltd., Vashi |
| 3 | Chamber Of Commerce, Hapur |
| 4 | Cotton Association of India, Mumbai |
| 5 | India Pepper & Spice Trade Association., Kochi |
| 6 | Indian Commodity Exchange Limited, New Delhi |
| 7 | Multi Commodity Exchange of India Ltd., Mumbai |
| 8 | National Commodity & Derivatives Exchange Ltd., Mumbai |
| 9 | National Multi Commodity Exchange of India Limited., Ahmedabad |
| 10 | Rajkot Commodity Exchange Ltd., Rajkot |
| 11 | Spices and Oilseeds Exchange Ltd., Sangli |
| 12 | Universal Commodity Exchange Ltd., Navi Mumbai |
Mumbai
October 21, 2015