Securities and Exchange Board of India is likely to de-recognise several stock exchanges across the country if they fail to separate ownership and trading rights of their members by Friday.

The market regulator had fixed September 5, 2003, as the last date for the bourses to get approval of their demutualisation scheme at their respective extraordinary general body meeting, official sources told PTI in New Delhi on Thursday.

However, more than six exchanges of the 21 bourses are yet to firm up the demutualisation and corporatisation plans.

The scheme was envisaged by the Kania committee under Sebi, which suggested separation of trading rights and ownership rights of the members.

This is part of efforts to bring in transparency and independency in the operations of the bourses in view of the stock market scams of 2001.

Out of the 21 bourses in the country, only National Stock Exchange is a demutualised entity and run by professionals and the other exchanges were in the process of getting the scheme approved at their respective EGMs.

Although Sebi has insisted on the demutualisation and corporatisation, regional bourses have favoured consolidation to stay afloat.

As per the current proposal, the Federation of Indian Stock Exchanges is trying to push through a proposal of consolidation of regional exchanges and forming Indonext, which would form a part of Bombay Stock Exchange.

Sebi had favoured the consolidation and may grant an extension to the demutualisation deadline if the regional bourses submit a concrete proposal.

Following the proposal of regional exchanges, BSE had expressed willingness to tie up with them to come up with a viable model of a consolidated Indonext Exchange.

The BSE board is expected to examine the viability of such consolidation and decide on preparing separate by-laws.

If the tie-up works out, it will be a nationwide consolidation of 20 bourses.

Except the National Stock Exchange, all other bourses have expressed interest in coming under the umbrella of Indonext.