SEBI Norms for sharing of real time price data to third parties

SEBI on May 24, 2024 has issued Norms for sharing of real time price data to third parties. SEBI has 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 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.

It has been decided that sharing of real time price data with third parties shall be subject to the following:

1. Stock exchanges, clearing corporations and depositories (collectively referred as Market Infrastructure Institutions (MIIs)) and registered market intermediaries shall ensure that no real time price data is shared with any third party including various, except where sharing of such information is required for orderly functioning of the securities market or for fulfilling regulatory requirements.
2. MIIs or market intermediaries shall enter into appropriate agreement with entities with whom they intend to share real time price data. The said agreement shall provide for activities for which the real time price data would be used by the entity including the justification that it is required for orderly functioning of the securities market. The list of entities and activities for which the real-time data is being shared with shall be reviewed by the Board of the MIIs or market intermediaries at least once in a financial year.
3. Market price data may be shared for investor education and awareness activities without offering any kind of monetary incentive to the participants, with a lag of 1 day.
4. MIIs and market intermediaries shall ensure due diligence while sharing such data. The legal agreement for sharing the data shall have provisions to prevent any kind of misuse of the same by the entities.
5. The MIIs and the market intermediaries shall on best effort basis take necessary steps to avoid misuse of price data by entities with whom the data is being shared.

The provisions of the circular shall be applicable from the 30th day of issuance of the circular.