BSE asked to pay higher regulatory fee

Leading stock exchange BSE is likely to pay more regulatory fee after the markets watchdog Securities and Exchange Board of India (Sebi) asked the bourse to pay the fee based on the “notional value” of its options contracts and not on the premium value.

Reacting to the development, shares of BSE slumped as much as 18.64 per cent to an intra-day low of Rs 2,612.0 on the NSE on Monday.

Market experts expect an increase in the BSE’s regulatory fee payments due to the variance between the notional and premium values. This discrepancy arises from the calculation method, which involves multiplying the contract size by the underlying price.

“BSE is hereby advised to pay the regulatory fee based on annual turnover to Sebi considering the notional value in case of options contract,” the exchange said in a filing to the National Stock Exchange (NSE) on Friday.

Also, the exchange has been asked to pay the differential regulatory fee for the past periods along with an interest of 15 per cent per annum on the remaining unpaid amount. It has been directed to pay the amount within one month of the receipt of the letter, the filing noted.

Sebi’s letter mentioned that since the introduction of derivative contracts, BSE has been paying the regulatory fee on “annual turnover” to the regulator considering premium value for option contracts, instead of the notional value.

In a disclosure on Sunday, BSE said it is currently evaluating the validity of the claim as per Sebi communication.

In case it is ascertained that the said amount is payable, the total differential Sebi regulatory fees for the period from FY 2006-07 to FY 2022-23 would be Rs 68.64 crore plus GST, which includes an interest of Rs 30.34 crore. Further, the differential Sebi regulatory fees for FY 2023-24, if liable, could be around Rs 96.30 crore plus GST, BSE said.
(With inputs from PTI)