Mumbai, August 01, 2018: BSE Investments Limited (BSEIL), a 100% subsidiary of BSE acquired 24 per cent stake in CDSL Commodity Repository Limited (CCRL).
BSE believes in creation of market infrastructure institutions for development of various markets. CCRL will help in transforming commodity markets by creating electronic negotiable warehouse receipts (eNWR), with an aim to develop a robust framework for clearing and settlement of commodity trades.
Regulated by the Warehouse Development and Regulatory Authority (WDRA), CCRL will record the storage and transfers of commodities including warehouse receipt transfers, although deliveries are in physical form. It is similar to the way depositories function for equities and other financial securities. A trade repository is another important step forward in improving regulatory transparency in the commodity derivatives markets in India.
As per SECC regulations 41(3), BSE cannot take direct stake in unrelated business. Hence as per the regulations, the stake is being taken through a subsidiary BSE Investments as specified in the regulation.
CCRL will enable electronic accounting of commodities, thereby ensuring ease of use, higher accuracy and lower costs for document transmission. The commodity repository will also provide the legal and regulatory environment for inventory financing and warehouse receipt lending.
Shri Ashishkumar Chauhan, MD & CEO, BSE said, “We are delighted to partner with CCRL to provide a repository for commodities that will support regulatory reporting requirements for development of the commodities derivatives in India. We believe this partnership will further strengthen our quest of developing and strengthening Commodity markets in India”.