Mumbai - Market regulator Securities and Exchange Board of India (Sebi) said it has exempted stock exchanges of Gujarat International Finance Tec-City International Financial Service Centre (GIFT City IFSC) from complying with certain Liquidity Enhancement Schemes (LES) requirements.
According to Sebi, the exemption has been made as the stock exchanges at GIFT IFSC are in a nascent stage and do not have access to net profits or free reserves.
"Based on the internal discussions and consultations held with the stakeholders and given the fact that the stock exchanges at GIFT IFSC are in a nascent stage and do not have access to net profits, free reserves, it has been decided to grant an exemption to stock exchanges at IFSC," the market regulator said in a circular.
"... subject to the condition that the exchange would create a reserve specifically to meet LES incentives, expenses based on the normative study of the LES in the domestic market and such reserves would not be included in the net worth calculation."
Vikram Limaye, Managing Director and Chief Executive Officer of the NSE, said the exemption was a step in the right direction to build liquidity, increase participation and develop robust markets.