SEBI Introduces New Regulations For Sharing Of Real-Time Price Data With Third Parties

New regulations were introduced by the Securities and Exchange Board of India (SEBI) to govern the sharing of real time data with the third parties, including various online platforms.

The SEBI said, “It has been observed that certain online gaming platforms, apps, websites, etc. (hereafter referred to as “platforms”) are providing virtual trading services or fantasy games which are based on the movement of real-time share prices (price data) of listed companies. Some platforms are even offering monetary incentives based on the performance of the virtual stock portfolio”.

SEBI has issued various guidelines to the Market Infrastructure Institutions (Market Infrastructure Institutions )–including stock exchanges, clearing corporations, and depositories and registered market intermediaries. According to the guidelines, Market Infrastructure Institutions and market intermediaries must ensure that real-time price data is not shared with any third party unless necessary for the proper



functioning of the securities market or regulatory compliance.

The SEBI added that the entities must enter into formal agreements in order to share the real-time data of share price, clearly outlining the activities for which the data will be used. Such agreements should ensure the support towards orderly functioning of the Securities Market.

The list of entities and activities must be reviewed annually by the board of the Market Infrastructure Institutions or intermediaries. The new guidelines will come into effect 30 days after the issuance of the circular, said SEBI.

According to SEBI, the market data can be shared for investor education and awareness without any monetary incentives, but this data must be delayed by one day. Direction has been issued by SEBI to Market Infrastructure Institutions and intermediaries to conduct due diligence when sharing data and provisions to be included in agreements to prevent misuse.