Description

BSE updates rules replacing arbitration references with dispute resolution mechanism and modifies authority for trade annulment decisions from Board/MD to authorized persons/committees.

Summary

BSE has amended its Rules, Bye-laws and Regulations to update terminology and administrative procedures. Key changes include replacing “arbitration” with “dispute resolution mechanism” in misconduct rules, updating fee references accordingly, and modifying the authority for trade annulment decisions from Board/Managing Director to authorized persons/committees.

Key Points

  • Rule 3(f) Chapter IV amended to replace “arbitration” references with “dispute resolution mechanism”
  • Members must submit to and abide by decisions of arbitral tribunal or arbitrators under dispute resolution mechanism
  • Rule 3(m) Chapter IV updated to change “arbitration charges” to “charges towards dispute resolution mechanism” for fee payment obligations
  • Bye-law 5(b) Chapter VII removes Board/Managing Director from trade annulment authority, delegates to authorized persons/committees
  • Bye-law 5(e) Chapter VII maintains Independent Oversight Committee review process for trade annulment decisions

Regulatory Changes

Rule Amendments - Chapter IV (Misconduct)

Rule 3(f) - Failure to Submit to Dispute Resolution:

  • Old: Failure to submit to or abide by “Arbitration” or decisions of “Arbitration Committee”
  • New: Failure to submit to or abide by “dispute resolution mechanism” or decisions of “arbitral tribunal”

Rule 3(m) - Failure to Pay Dues and Fees:

  • Old: Failure to pay “arbitration charges”
  • New: Failure to pay “charges towards dispute resolution mechanism”

Bye-law Amendments - Chapter VII (Inviolability of Trade)

Bye-law 5(b) - Trade Annulment Authority:

  • Old: Board or Managing Director or other authorized persons/committees may annul trades
  • New: Only authorized persons/committees (as authorized by Board) may annul trades - removes Board/MD direct authority

Bye-law 5(e) - Review Mechanism:

  • Maintains existing review process by Independent Oversight Committee on Trading and Surveillance function
  • No changes to aggrieved party’s right to request review

Compliance Requirements

  • BSE members must comply with updated terminology in all dispute resolution proceedings
  • Members remain obligated to submit to dispute resolution mechanism and abide by decisions of arbitral tribunal/arbitrators
  • Members must pay all charges towards dispute resolution mechanism as part of fee obligations
  • Trade annulment requests will be processed through authorized persons/committees rather than Board/MD directly
  • All existing obligations regarding trade annulment and dispute resolution remain substantively unchanged

Important Dates

  • Circular Date: November 20, 2025
  • Effective Date: Not explicitly mentioned (amendments effective immediately unless otherwise specified)

Impact Assessment

Market Impact: Low - Changes are primarily terminological and administrative in nature

Operational Impact:

  • Streamlines trade annulment decision-making by removing Board/MD involvement
  • Modernizes dispute resolution terminology to align with current practices
  • No change to member obligations or compliance burden

Member Impact:

  • Members must use updated terminology in fee payments and dispute proceedings
  • Procedural changes in trade annulment authority should improve efficiency
  • No material change to member rights or obligations under dispute resolution framework

Governance Impact:

  • Clarifies delegation of trade annulment authority to operational level
  • Maintains oversight through Independent Oversight Committee review process
  • Aligns with efficient governance practices by delegating operational decisions

Impact Justification

Procedural amendments to dispute resolution terminology and delegation of trade annulment authority. Affects member obligations but does not change core operational requirements or market structure.