Securities and Exchange Board of India (SEBI) has introduced the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2025, which focus on the responsibilities of stock exchanges and clearing corporations when using artificial intelligence (AI) and machine learning (ML) tools. These amendments, effective upon publication in the Official Gazette, mandate that any recognized stock exchange or clearing corporation deploying AI-driven tools, whether developed in-house or sourced externally, must take full responsibility for data security, privacy, and regulatory compliance. The regulation underscores the need for safeguarding investors’ and stakeholders’ data while ensuring that AI-generated outputs align with applicable legal requirements.
The newly added Regulation 39B outlines three key obligations: maintaining the integrity of investor and stakeholder data, being accountable for AI-generated outcomes, and ensuring adherence to existing laws. This amendment applies to AI and ML tools used in trading, settlement processes, compliance management, and other operational activities. The move aims to create a structured framework for AI adoption within financial market infrastructure, ensuring transparency and risk management. With these amendments, SEBI continues to update regulatory frameworks to address emerging technological risks in the securities market.
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 6th February, 2025
SECURITIES CONTRACTS (REGULATION) (STOCK EXCHANGES AND CLEARING CORPORATIONS) (AMENDMENT) REGULATIONS, 2025
F. No. SEBI/LAD-NRO/GN/2025/227 ─ In exercise of the powers conferred by sections 4, 8A and 31 of the Securities Contracts (Regulation) Act, 1956, read with sections 11 and 30 of the Securities and Exchange Board of India Act, 1992, the Board hereby makes the following regulations to further amend the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018, namely, –
1. These regulations may be called the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2025.
2. They shall come into force on the date of their publication in the Official Gazette.
3. In the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018, in Chapter VI after existing regulation 39A the following new regulation shall be inserted, namely,–
“Responsibility for the use of artificial intelligence
39B. A recognized stock exchange and a recognized clearing corporation which uses artificial intelligence and machine learning tools and techniques, either designed by it or procured from third-party technology service providers, irrespective of the scale and scenario of adoption of such tools for conducting its business and servicing its clients or constituents, shall be solely responsible–
a. for the privacy, security and integrity of investors’ and stakeholders’ data including data maintained by it in a fiduciary capacity throughout the processes involved;
b. for the output arising from the usage of such tools and techniques it relies upon or deals with, and
c. for the compliance with applicable laws in force.
Explanation: For the purpose of this regulation, the expression “artificial intelligence and machine learning tools and techniques” may include any application or software program or executable system or a combination thereof, offered by a recognized stock exchange or a recognized clearing corporation to investors/stakeholders or used internally by it to facilitate trading and settlement or to carry out its activities including compliance requirements and the same are portrayed as part of the products offered to the public or under usage for compliance or management or other business purposes.”
BABITHA RAYUDU, Executive Director
[ADVT.-III/4/Exty./950/2024-25]
Footnote:
1. The Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 were published in the Gazette of India on 3rd October 2018 vide No. SEBI/LAD-NRO/GN/2018/41.
2. The Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 were subsequently amended on-
(a) 4th June, 2019, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2019 vide No. SEBI/LAD-NRO/GN/2019/21
(b) 17th April, 2020, by the Securities and Exchange Board of India (Regulatory Sandbox) (Amendment) Regulations, 2020vide No. SEBI/LAD-NRO/GN/2020/10.
(c) 8th October, 2020, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2020 vide No. SEBI/LAD-NRO/GN/2020/32.
(d) 23rd March, 2021, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO/GN/2021/12.
(e) 13th August, 2021, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2021 vide No. SEBI/LAD-NRO/GN/2021/44.
(f) 12th August 2022, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2022 vide No. SEBI/LAD-NRO/GN/2022/93.
(g) 1 5th November, 2022, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2022 vide No. SEBI/LAD-NRO/GN/2022/104.
(h) 28th February, 2023, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2023 vide No. SEBI/LAD-NRO/GN/2023/124.
(i) 24th July, 2023, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2023 vide No. SEBI/LAD-NRO/GN/2023/139.
(j) 22nd August, 2023, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Third Amendment) Regulations, 2023 vide No. SEBI/LAD-NRO/GN/2023/148.
(k) 26th April, 2024, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/171.
(l) 10th May, 2024, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/174.
(m) 29th July, 2024, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Third Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/196.
n. 29thAugust, 2024, by the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Fourth Amendment) Regulations, 2024 vide No. SEBI/LAD-NRO/GN/2024/202.
