The Securities and Exchange Board of India (Sebi) has officially withdrawn the recognition granted to the Indian Commodity Exchange Ltd (ICEX), marking the exchange's exit from the bourse business. The decision follows Sebi’s approval on December 11, allowing ICEX to exit after it had met necessary regulatory requirements.
Sebi issued a notification on December 24 confirming that the recognition of ICEX, which had been granted under the Forward Contracts (Regulation) Act, 1952 (FCRA), was officially withdrawn. The notification marked the formal end of ICEX’s role as a recognized stock exchange.
In its exit order, Sebi stated that it had reviewed ICEX’s valuation report, compliance submissions, and undertakings before making the decision. Additionally, the regulator outlined certain compliance obligations for ICEX post-exit, including settling its tax liabilities under the Income Tax Act, 1961, changing its name, and refraining from using the term "stock exchange." Sebi also directed ICEX to maintain a comprehensive database of all transactions conducted on its platform in previous years.
ICEX, which is based in Surat, Gujarat, had originally received permanent recognition in 2009 under the FCRA. Following the merger of the Forward Markets Commission with Sebi in 2015, ICEX became a recognized stock exchange under the Securities Contracts (Regulation) Act, 1956 (SCRA). However, in May 2022, Sebi derecognized ICEX due to non-compliance with minimum net worth requirements, infrastructural deficiencies, and inspection findings.
Although ICEX appealed to the Securities Appellate Tribunal (SAT) and was allowed to temporarily retain its recognition, the exchange faced challenges raising the necessary funds due to Sebi’s stringent shareholding cap of 5% for investors. ICEX requested a relaxation to allow investors to hold up to 51% equity for five years, but Sebi declined the request. Subsequently, in May 2023, ICEX shareholders approved the voluntary surrender of the exchange's recognition, leading to the initiation of the exit process.
