SEBI may make listing optional for exchanges

The Securities and Exchange Board of India is debating whether to make listing optional for stock exchanges and separating their regulatory and business roles, according to reports.

The move comes during the ongoing debate over the proposed new norms for ownership and governance of stock exchanges. The market regulator is considering whether the bourses could be asked to put in place 'Chinese walls' between their regulatory and corporate functions, a senior official has told sections of the media.

The move was aimed at keeping the front-line regulatory role of bourses unaffected by their profit-making and other business interests after they became publicly-held companies, the official added.

Ever since a SEBI-appointed committee headed by former Reserve Bank of India (RBI) governor Bimal Jalan gave a report late last month on the ownership and governance of stock exchanges, there has been a heated debate over various proposals.

The committee has suggested sweeping changes in the way exchanges function. One of the key proposals is not to allow bourses to get listed in order to to safeguard their front-line regulatory role.

The committee recommendations, put out by SEBI for public comments till the end of December, have faced severe criticism from various quarters, including industry chambers and many market participants, including the Bombay Stock Exchange, the country's oldest bourse, and the new entrant, MCX-SX.