IFSCA notifies bullion exchange regulations

The International Financial Services Centres Authority (IFSCA) on Sunday said it has notified bullion exchange regulations, paving the way for setting up the entire ecosystem for bullion trading, including bullion exchange, depository, clearinghouse and vaults.

IFSCA has been entrusted with the responsibility of operationalization of this exchange, an official statement said.

"In this regard, the International Financial Services Centres Authority (Bullion Exchange) Regulations 2020 were approved by the Authority in its meeting held on October 27, 2020. The said regulations have been notified and published in the Gazette of India on December 11, 2020," it said.

The regulations among other things cover the bullion exchange, clearing corporation, depository and vaults, it said, adding that the regulations are divided into the 16 chapters.

The first half of the regulation deals with the exchange and clearing corporations, while the second half pertains to vaults and depositories and related provisions, it said.

In the Union Budget 2020, Finance Minister Nirmala Sitharaman had made an announcement for setting up an International Bullion Exchange at the International Financial Services Centre in GIFT City, Gandhinagar, Gujarat.

Subsequently, the Government of India had notified the bullion spot delivery contract and bullion depository receipt (with bullion as underlying) as financial products and related services as financial services under the International Financial Services Centres Authority (IFSCA) Act, 2019.

Gujarat-headquartered IFSCA has been authorised to regulate all financial services at IFSCs. IFSCA was established on April 27 this year, with its head office in Gandhinagar.

In December 2019, the Parliament passed a bill to set up a unified authority for regulating all financial activities at IFSCs in the country.