IFSCA authority Board approved Two New Regulations.

The International Financial Services Centre Authorities (IFSCA) approved two new regulations during the board meeting held on October 27, 2020. The two  regulations were- The International Financial Services Centre authorities Bullion exchange regulations, 2020 and the International financial services Centre authorities Global inhouse centres regulation, 2020.  These two regulations paves the way to set up an entire ecosystem for bullion trading including the bullion exchange, depository, clearing house, and vaults in the Gift City of Gujarat. Gift city is the India’s sole international financial services centre (IFSC).

International Financial Services Centres Authorities (Bullion Exchange) regulations, 2020

Government of India has notified the bullion depository receipt and bullion spot delivery contract as financial products on the basis of the recommendation of the International Financial Services Centre authorities. These have been notified under the International Financial Services centre at authority act, 2019. The IFSCA has been tasked to operate the new bullion exchange. This is for the first time that a single authority would regulate both the derivative contract and the bullion spot. The bullion regulation would integrate the following salient aspects to facilitate the transparency and traceability in the bullion market:

  1. Gender obligations and functions of bullion exchange.
  2. Obligations and rights of Bullion depositary is beneficial owners and participants.
  3. Governance and ownership structure of the bullion exchange.
  4. Grant of registration.
  5. Role of Bullion repositories.

International Financial Services Centre Authority (Global in-house Centre) circulation 2020

Government of India has notified the Global inhouse centres as financial services on the recommendations of IFSCA. These centres will be providing the services related to financial products. Salient aspects of the regulation include:

  1. Global inhouse centre can conduct its business in any mode as listed by the authority.
  2. Entities that are being serviced must be located in a financial action task force (FATF) complaint jurisdiction.
  3. Setting up of a global inhouse centre within the IFSC will be valid with concession applicable to IFSC units.