IFSCA Authority Board approves two Regulations:
A meeting of the IFSCA - International Financial Services Centres Authority was held on October 27, 2020. The Board, after detailed discussion, approved the following regulations - International Financial Services Centres Authority (Bullion Exchange) Regulations, 2020 and International Financial Services Centres Authority (Global In-House Centres) Regulations, 2020.
International Financial Services Centres Authority (Bullion Exchange) Regulations, 2020:
The GoI - Government of India, on the recommendation of IFSCA, 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 IFSCA Act, 2019 on August 31, 2020. The Authority approved the draft bullion regulations, which paves the way for setting up the entire ecosystem for bullion trading, namely, bullion exchange, depository, clearinghouse and vaults.
The salient aspects of the Bullion Exchange Regulations include:
♦ Functions and general obligations of a bullion exchange and clearing corporation
♦ Ownership and governance structure of a bullion exchange and clearing corporation
♦ Rights and Obligations of Bullion Depositories, Participants and Beneficial Owners
♦ The grant of registration to a vault manager by the Authority
♦ The role of bullion depositories
♦ Other operational aspects of the bullion exchange
The Bullion Exchange Regulations envisage providing an integrated platform for all the market intermediaries including trading members/ clearing members, bullion depositories, vault managers, etc. so as to facilitate transparency and traceability in the bullion market and standardisation of bullion contracts.
International Financial Services Centres Authority (Global In-House Centres) Regulations, 2020:
Government of India, on the recommendation of IFSCA, had notified Global In-House Centres (GIC) as financial service to provide services relating to financial products and financial services on October 16, 2020.
Some salient features of the regulations are as follows:
♦ Global In-house Centres (GIC) may conduct its business in any mode permitted by the Authority. The applicant entity shall exclusively serve to its financial services group wherein the entities served must be located in a FATF - Financial Action Task Force compliant jurisdiction.
♦ A financial services group is an entity which is regulated by a financial services regulator or any other competent body regulating financial services activities in its home jurisdiction.
♦ The support services provided should be for the purpose of carrying out a financial service in respect of a financial product. A Global In-House Centres (GIC) set up within the IFSC shall be entitled to avail itself of all concessions.
♦ India is emerging as global`s leading centre of digitization, with one of the largest pool of digital talents. Global In-house Centres (GIC) in India have been contributing to the development of a highly-skilled talent pool in the country.
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