Within hours, after Moneylife published a report about the unjustified increase in arbitration fees, SEBI has modified its earlier circular saying that there is a maximum limit on arbitration fees.
Within hours after Moneylife published a report about the unjustified increase in arbitration fees (http://www.moneylife.in/article/72/8688.html ), Securities and Exchange Board of India (SEBI) has modified its earlier circular. In the modified circular, the market regulator has clarified that the circular has put a maximum limit on arbitration fees. SEBI has also increased the limitation period for filing arbitration claims to three years from six months.
According to the modified circular, there is a maximum limit on arbitration fees and the circular removes the uncertainty about such fees prevailing earlier where exchanges could collect additional charges beyond initial deposit.
"A client filing an arbitration reference for claim/counter claim up to Rs10 lakh within six months does not have to pay any fees. For such clients, the costs are to be borne by the stock exchange," the modified circular said.
SEBI has also made the number of arbitrators uniform across exchanges. Claims less than Rs25 lakh will be dealt by a sole arbitrator and claims more than Rs25 lakh will be dealt with by a panel of three arbitrators.
In order to ensure that the arbitration proceedings are completed in a time bound manner, timelines have been prescribed at each stage of activity, the modified circular said.
Earlier on Tuesday, Moneylife reported "Investors furious over SEBI's hike in arbitration fees, tilting the ground in favour of NSE"
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