Mumbai: The market regulator has clarified that it’s neither necessary for digital platforms to hunt recognition as a ‘specified digital platform’, nor are they instantly authorities by Sebi rules.
The Securities and Trade Board (Sebi) had on 29 August stated that regulated people or entities, akin to inventory exchanges, clearing firms, depositories and their brokers, shouldn’t be instantly or not directly linked to anybody who gives recommendation or suggestions on securities until registered or permitted by the regulator; and anybody who makes claims about returns or efficiency of securities, until authorised by it.
Nevertheless, it excluded associations that have been acknowledged as specified digital platforms (SDPs) primarily based on their means to take preventive and corrective actions towards prohibited actions.
In a clarification issued on December 4, the market regulator cited the confusion within the media in regards to the obligation of digital platforms to be acknowledged as SDPs.
“It’s not compulsory for any digital platform to be notified as SDP and there’s no regulation of those digital platforms by SEBI. Healing actions presently being carried out by some digital platforms are in accordance with regulation. Preventive steps contemplated for any digital platform to get notified as SDP shouldn’t be necessary and it’s for the platform to decide or not go for getting notified as SDP,” Sebi stated in an announcement.
If a platform is designated as an SDP, Sebi stated, regulated entities could be assured that their affiliation with it won’t result in violations of the market regulator’s rules. Nevertheless, it added that regulated entities should not obligated to work completely with SDPs.
Sebi clarified that its main objective to carry regulatory modifications was to offer assurance to regulated entities that working with an SDP ensures compliance with Sebi’s stringent guidelines.
