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The tribunal also directed the NSE to give an undertaking that it would have to pay the full penalty, along with interest at the rate of 9% per annum, if it loses the case
New Delhi: The Competition Appellate Tribunal (Compat) today stayed a Rs55.5 crore penalty imposed by the Competition Commission of India (CCI) on the National Stock Exchange (NSE) for abuse of its dominant market position, but asked the bourse to comply with the other directions of the fair-trade watchdog in this matter, reports PTI.
Passing an interim directive based on the NSE's plea against the CCI order, a three-member bench headed by Compat chairman justice Arijit Pasayat stayed the penalty and said that, prima-facie, it saw a case in the matter.
The tribunal asked the NSE to file an affidavit within six weeks regarding compliance with the CCI order, which had asked the bourse to levy a transaction charge on currency derivatives trading and segregate its accounts for various business segments, among other things.
The Compat also issued notices to the CCI and Multi Commodity Exchange Stock Exchange (MCX-SX), on whose complaint the competition watchdog had initiated a probe against its rival exchange, the NSE. The CCI and MCX-SX have been asked to reply to the notices within four weeks.
The tribunal also directed the NSE to give an undertaking that it would have to pay the full penalty, along with interest at the rate of 9% per annum, if it loses the case.
The matter came up for its first hearing before Compat today, after the NSE filed an appeal last month through leading corporate law firm Amarchand & Mangaldas against the CCI order.
The NSE had in its appeal asked for a stay on the order and relief from payment of the penalty of Rs55.5 crore, as well as any claims of compensation sought by MCX-SX or any third party.
In response, Compat granted a conditional stay on payment of the penalty, but on the condition that the NSE, if found guilty, will have to pay interest at the rate of 9% on the amount from the date of the CCI order till the date of payment.
The stay would not be applicable on any claims for compensation by MCX-SX or any other party. MCX-SX is yet to file any claims for compensation.
The other CCI directions which the NSE has been asked to adhere to by Compat include an order to maintain separate accounts for each segment with effect from the next financial year, the levy of transaction charges, discontinuation of its zero-pricing policy and co-operation in a trading software matter.
The NSE has already started imposing a charge in the currency derivatives segment and has also agreed to settle a trading software dispute with the MCX-SX group.
The NSE, in its appeal, has asserted that it was wrongly charged with leveraging its dominance in equity and other segments to benefit in the currency derivatives market.
In its order dated 23rd June, the CCI had imposed a Rs55.5 crore fine on NSE for abusing its dominant market position and asked the bourse to stop unfair trade practices like subsidising its services with a zero-price regime in the currency derivatives segment.
Imposing a penalty equivalent to 5% of the bourse's three-year average turnover, the CCI had said there was "a clear intention on the part of NSE to eliminate competitors in the relevant market".
The CCI order followed a months-long probe into the matter after a complaint from the NSE's younger rival, MCX-SX.