Transaction Charges by Commodity Derivatives Exchanges
Summary
SEBI mandates specific norms for Commodity Derivatives Exchanges regarding the levying of transaction charges to promote competition and efficiency. The circular requires exchanges to maintain a maximum 1.5:1 ratio between highest and lowest charges within turnover slabs and apply concessional rates only on incremental volume. These provisions supersede earlier directives from the erstwhile FMC and become effective from September 29, 2016.
Text
The following norms shall be continued to be applicable to the Commodity Derivatives Exchanges while levying transaction charges
The Exchanges can levy different transaction charges for different commodities' contracts and even in the case of contracts of the same commodity
The Exchanges will ensure that the ratio between highest to lowest transaction charges in the turnover slab of any contract is not more than 1.5:1
In the slab system the concessional transactional charges shall be charged only on the incremental volume/turnover and not on the entire volume/turnover
The transaction charges are to be charged-on post-facto basis that is after the trades are executed
It is also emphasized that, while revising the transaction charges, the Commodity Derivatives Exchanges shall also comply with the following guidelines prescribed vide SEBI Circular MRD/DoP/SE/Cir-14/2009 dated October 14, 2009
The stock exchange system is capable of handling additional load
It does not affect the existing risk management system
It does not favour selective trades or selective category of investor
It does not encourage generation of artificial demand
It does not result in any market irregularities
It is uniformly applied to trades of similar nature
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Source: SecMarx — Transaction Charges by Commodity Derivatives Exchanges. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.