| Reuters August 28, 2006 SINGAPORE/SHANGHAI SINGAPORE Exchange, Asia's third-largest listed bourse, said on Monday, August 28, it would go ahead with plans to launch a China stock futures contract despite legal action by firms which compile data for China's exchanges. Singapore Exchange last week announced plans to launch a futures contract based on an index of China's A-shares on Sept. 5. The index, compiled by FTSE/Xinhua Index, will consist of the top 50 Shanghai- and Shenzhen-listed stocks by market capitalisation. However, the announcement prompted two Chinese companies to attempt to block the new contract. "Our launch plans remain unchanged," a spokeswoman for the Singapore Exchange said. A spokeswoman for SSE Infonet Ltd, a subsidiary of the Shanghai Stock Exchange which manages data for the bourse, said a court had accepted its case. "We have launched a suit against FTSE/Xinhua Index and today we received a notice from the court, which said they have accepted the case." She declined to give details. Shenzhen Securities Information Co., which manages data for the Shenzhen stock market, declined to comment. But an official Chinese newspaper said that the firm had also filed a suit. The China Securities Journal reported on Saturday that SSE and Shenzhen Securities had filed suits against FTSE/Xinhua Index in a Shanghai court last week, alleging violation of their intellectual property. China plans to set up a financial derivatives exchange this year on which its own stock index futures contract will trade. The Shanghai Stock Exchange will own part of the new derivatives exchange. FTSE/Xinhua Index, which is a joint venture between Britain's FTSE Group and Tokyo-listed Xinhua Finance , a Shanghai-based financial information and media services firm, said on Monday it was authorised to use the data. Mark Makepeace, chairman of FTSE/Xinhua Index, told Reuters by telephone on Monday that his company had a contract with SSE giving it all necessary permissions to launch its Singapore futures contract, including permission to license derivatives. "We do not believe they will have any basis for termination," said Makepeace, who is chief executive of Britain's FTSE Group. He said FTSE/Xinhua would defend its position in court if necessary. The Shanghai exchange sees the Singapore futures "as competitive to the futures contracts they wish to launch on the new China derivatives exchange in which they are a part owner", he said. FTSE/Xinhua also licenses an exchange-traded fund in Hong Kong, the FTSE/Xinhua A50 China Tracker. Makepeace said the legal dispute did not extend to that fund or to other funds and over-the-counter derivatives that his company had been licensing. |
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