India Plans to Streamline Arbitration Mechanism

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Aug. 16 – India’s Securities and Exchange Board of India (Sebi) has instructed stock exchanges to ease the arbitration process for disputes involving a client and a member.

Sebi is proposing that all exchanges must have their own panel of qualified arbitrators depending on the amount of disputes. An arbitrator must have experience in the securities market and a background in law, finance, accounts and economics. Moreover, the person must not have a history of involvement in any act of fraud, dishonesty or economic offense.

Each arbitrator is required to undergo a minimum of seven days of continuing education organized by the stock exchange. The board proposes that arbitrator performance evaluations should be conducted annually.

An arbitrator will be allowed to handle an arbitration reference for a claim or counter claim worth up to Rs. 2.5 million. Cases worth more than Rs. 2.5 million will have a panel of  three arbitrators.

A company or individual is allowed to appeal against an arbitrage award within one month from the date the award was given to a stock exchange’s appellate panel of arbitrators.