Media Release

SEBI has granted in-principal approval to BSE for setting up the International Exchange and International Clearing Corporation in GIFT International Financial Services Centre (GIFT City)

Mumbai: November 01, 2016: BSE, Asia’s oldest exchange and now world’s fastest exchange with order response time of 6 microseconds, received in-principal approval from SEBI for setting up international exchange & International clearing corporation today.  International Financial Services Centre (IFSC) outlines were first announced by the Ministry of Finance on March 1, 2015

SEBI was the first regulator to announce the IFSC guidelines on March 27, 2015 for Capital Market. This was followed by RBI for International Banking Units on April 1, 2015 and IRDA for Insurance Industry on April 6, 2015.

The Hon’ble Finance Minister in his Union Budget of 2016 announced various special economic benefits to the IFSC in the form of exempting Securities Transaction Tax (STT), Commodities Transaction Tax (CTT),  Dividend Distribution Tax (DDT) and also provided a 5 year Income Tax Holiday with another 50 % reduction in Income Tax for the next 5 years. Also the Minimum Alternate Tax applicable in IFSC has been reduced to 9 % vis-à-vis 18.5 %. This was notified in the Finance Bill on May 14, 2016. Indirect taxes like Service Tax and Custom Duty are also not applicable in IFSC. Government of Gujarat has also exempted stamp duty for entities having registered office in GIFT for capital market activities.

The BSE Board in its meeting held on May 5, 2016 approved creation of two wholly owned subsidiary companies for the purpose of setting up the first International Exchange and International Clearing Corporation. BSE applied to SEBI for in-principal approval which it has received November 01, 2016.

BSE’s plan is to operationalise the International Exchange in early 2017. Mock trading for the same commence from October 3, 2016.  

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Yatin Padia

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Yatin.padia@bseindia.com