SEBI Not Considering Self-Listing of Stock Exchanges for Now, Chairman Says

The Securities and Exchange Board of India (SEBI) is not currently considering a proposal that would allow stock exchanges to trade their own shares on their platforms, chairman Tuhin Kanta Pandey said on September 30. 

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

Pandey’s comments came days after a report suggested that the market regulator could set up a committee to examine rules around self-listing of exchanges. 

Speaking at an event in Mumbai, the SEBI chairman made it clear that the regulator has no such proposal under consideration at present. He also pointed to the responsibility exchanges carry in checking disclosures made by companies listed on their platforms. 

The issue has gained attention following the listing of the National Stock Exchange (NSE) on rival BSE. NSE Chairman Srinivas Injeti had called for the regulator to reconsider whether exchanges should be allowed to list and trade on their own platforms. 

SEBI has considered the subject before. In 2015, the regulator examined the possibility of self-listing but decided against it because of concerns over potential conflicts of interest. Under the existing arrangement, shares of an exchange are required to trade on a rival exchange. 

Self-listing, however, is allowed in some major international markets. In the United States, for instance, Intercontinental Exchange, the parent company of the New York Stock Exchange, is listed and traded on the NYSE itself. 

The earlier report on a possible review had indicated that issues such as conflicts of interest and governance would need to be addressed before any change could be considered. It had also suggested that the responsibility for oversight could remain with the primary exchange. 

The discussion is particularly relevant given NSE’s position in India’s markets. The exchange accounts for about 93% of cash-market trading and nearly 75% of options trading. 

Exchange stocks were under pressure during Wednesday’s session. At 12:10 pm on September 30, BSE shares were trading 3% lower, while recently listed NSE shares were marginally down. 

For now, Pandey’s comments put the speculation around an immediate regulatory review to rest, with SEBI not considering self-listing at this stage.