PR No.03/2011
Arbitration Mechanism in Stock Exchanges – Limitation Period
SEBI, vide circulars dated August 11, 2010 and August 31, 2010, had streamlined the arbitration mechanism available at stock exchanges for arbitration of disputes (claims, complaints, differences, etc.) arising between a client and a member (Stock Broker, Trading Member and Clearing Member) across various market segments.
Under the new framework, arbitration claims beyond six months can also be filed since the limitation period for arbitration has now been modified to three years as prescribed under the Limitation Act, 1963.
Based on the representations received, it has been decided that the modified limitation period shall be applicable to cases where three years have not yet elapsed and no arbitration has been filed or arbitration was filed but rejected solely on the ground of delay in filing within the earlier limitation period of six months. The concerned parties can now approach the stock exchanges for filing arbitration in aforesaid cases within the new limitation period of three years.
A Circular detailing the modalities for the above will be issued shortly.
Mumbai
January 06, 2011