Bill to make cooperatives accountable also gets nod

The Union Cabinet on Thursday approved for introduction in Parliament the Forward Contracts (Regulation) Amendment Bill, 2010, that amends the Forward Contract (Regulation) Act and the Multi-State Cooperative Societies (Amendment) Bill, 2010, that seeks to improve the accountability of cooperatives. Both Bills will be tabled in the next session of Parliament.

The FC(R) Act, 1952, provides for the regulation of commodity futures markets and the establishment of the Forward Markets Commission (FMC).

The proposed amendments will enable the FMC, as a regulator, to become an autonomous body with powers to regulate the market on the lines of the Securities and Exchange Board of India. At present it functions under the Department of Consumer Affairs.

The FC (R) Bill permits exchanges to trade in options in goods or options in commodity derivatives that enables stakeholders to effectively manage risk from price fluctuations.

The amendments proposed include corporatisation and demutualisation of the existing commodities exchanges and setting up of a separate Clearing Corporation, registration of Intermediaries and enhancement of penal provisions in the FC(R) Act.

The Bill calls for designating the Securities Appellate Tribunal (SAT) as the Appellate Tribunal. The other Bill okayed by the Cabinet that amends the Multi-State Cooperative Societies Act, 2002, intends to enhance the public faith in cooperatives and to ensure better accountability of the management towards its members and the law of the land, said an official press release.

It also allows for co-opting experts from various sectors such as banking, finance and the specialised field of the cooperative.

Keywords: FMC amendments

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