The Securities and Exchange Board of India has modified the framework for handling “technical glitches” in stock brokers’ electronic trading systems following a public consultation, with changes aimed at easing compliance for brokers. The revised framework now applies only to stock brokers with more than 10,000 registered clients, which SEBI estimates will move around 60% of brokers out of scope. The updated approach also exempts certain incidents from the technical glitch framework, including glitches occurring outside a broker’s trading architecture, glitches that do not directly affect trading functionality, and those with negligible impact. Reporting requirements have been simplified by extending the reporting timeline from one hour to two hours, allowing consideration of trading holidays, and shifting from reporting to all exchanges to submission via a single Common Reporting Platform; technology compliance expectations such as capacity planning and disaster recovery drills have been rationalised based on broker size and technology dependence. SEBI has also rationalised the financial disincentive structure to reflect applicable exemptions, the type of glitch (major or minor) and frequency of occurrence, with stock exchanges to issue the disincentive framework.
Securities & Exchange Board of India 2026-01-09
Securities and Exchange Board of India revises stock broker technical glitch framework, limiting scope to firms with over 10,000 clients
The Securities and Exchange Board of India (SEBI) has revised its framework for managing "technical glitches" in stock brokers' electronic trading systems, now applying only to brokers with over 10,000 clients, thus excluding about 60% of brokers. Key changes include exemptions for certain incidents, extended reporting timelines, and rationalized technology compliance and financial disincentive structures based on broker size and glitch impact.