Markets regulator, the Securities and Exchange Board of India (SEBI), has extended the deadline for public comments on its proposal concerning the requirements for recognition as specified digital platforms (SDPs). Initially set for November 12, the deadline has now been moved to November 26. The extension follows representations from several entities and organizations requesting more time to submit feedback.
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SEBI Responds to Stakeholder Requests for More Time
In a statement, SEBI clarified that the decision to extend the timeline came after receiving requests from stakeholders seeking more time to review and respond to the consultation paper. The regulator had earlier issued a paper outlining the requirements for SDPs to prevent fraud, impersonation, unauthorized claims, and the operation of unregistered entities on these platforms.
The proposed guidelines aim to ensure that digital platforms, particularly those dealing with securities-related content, adopt proactive measures to safeguard investors. SEBI has recommended the use of artificial intelligence (AI) or machine learning (ML) tools to monitor and control content related to securities. This includes ensuring that only SEBI-registered entities or permitted advertisers can post securities-related content and that platforms prevent unauthorized advice, recommendations, or performance claims.
SEBI also emphasized the importance of authentic investor education content, stressing that platforms should not redirect users to other channels like WhatsApp or Telegram for unauthorized activities. The regulator has also proposed that platforms be required to share data with SEBI when requested and act on the regulator’s inputs.
As part of its move to curb unauthorized financial advice and performance claims, SEBI had earlier given a three-month window starting October 22 for registered entities and their agents to terminate contracts with unregistered financial advisors. The rule aims to prevent unregistered entities from providing investment advice or recommendations, as well as from making performance claims without SEBI’s authorization.
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The proposed regulations also include provisions allowing platforms to remove fraudulent or non-compliant content and penalize offenders, contributing to a more secure and transparent digital space for investors. The extended deadline provides additional time for public input on these important regulatory changes.
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