SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data

SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data
SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data (Image:ANI)
SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data
SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data (Image:ANI)

SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data

SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data

SEBI Introduces New Rules to Regulate Sharing of Real-Time Share Price Data

Key Highlights:

  1. New SEBI guidelines aim to curb misuse of real-time share price data.
  2. Market Infrastructure Institutions (MIIs) must ensure data sharing only supports market function.
  3. Real-time data sharing for investor education is allowed with a one-day delay.

The Securities and Exchange Board of India (SEBI) has announced new regulations to govern the sharing of real-time share price data with third parties, including online platforms. This move aims to prevent misuse, particularly by online gaming platforms, apps, and websites offering virtual trading services or fantasy games based on real-time share prices of listed companies.

SEBI observed that some online gaming platforms and apps provide virtual trading services and fantasy games that rely on real-time share price movements. Additionally, some platforms offer monetary incentives based on the performance of virtual stock portfolios. To address these concerns, SEBI has issued guidelines to Market Infrastructure Institutions (MIIs)—including stock exchanges, clearing corporations, and depositories—and registered market intermediaries.

SEBI’s guidelines stipulate that MIIs and market intermediaries must ensure that real-time price data is not shared with any third party unless it is necessary for the proper functioning of the securities market or for regulatory compliance. Entities wishing to share real-time price data must enter into formal agreements detailing the specific activities for which the data will be used, ensuring it supports the orderly functioning of the securities market. These agreements and the list of entities and activities must be reviewed annually by the boards of MIIs or intermediaries.

The guidelines will take effect 30 days after the issuance of the circular, according to SEBI. The market regulator also stated that market price data could be shared for investor education and awareness purposes without any monetary incentives, provided the data is delayed by one day.

Furthermore, SEBI directed MIIs and intermediaries to conduct due diligence when sharing data and to include provisions in agreements to prevent misuse. They must also take all possible steps to prevent the misuse of price data by the entities.

(Inputs from ANI)

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