Sebi has robust measures for proper functioning of securities markets: IOSCO report

New Delhi: Markets watchdog Sebi has been identified by a global body of regulators among those having put in place robust measures to ensure the orderly functioning of securities markets. This is a part of the findings of an International Organization of Securities Commissions (IOSCO) report titled “Standards Implementation Monitoring on Secondary and Other Market Principles”. These secondary and other market principles seek to promote fair, efficient and transparent markets and provide core elements of an essential regulatory framework for securities regulations. International Organization of Securities Commissions (IOSCO) is a global body of securities regulators from across the world and sets international standards for various regulations and reforms in capital markets space. [caption id=“attachment_4307425” align=“alignleft” width=“380”] Representational image. Reuters.[/caption] According to the report, the Indian capital markets regulator has mostly implemented secondary market principles. These secondary market principles cover areas such as authorisation, oversight and ongoing supervision requirements; transparency requirements; detection and deterring market misconduct; and also deal with managing risks, such as monitoring large exposures, default procedures and short selling. In India, the recognised stock exchanges have in place automated systems of market surveillance which are complemented by Sebi’s own system that allows for surveillance across bourses and market segments, as per the report. It noted that Sebi’s Integrated Market Surveillance System (IMSS) and Data warehouse & Business Intelligence System (DWBIS) integrate the data from across the stock exchanges and depositories. All data from the exchanges and depositories are delivered overnight and fed into IMSS and DWBIS. DWBIS is an in-house system developed by Sebi for data mining and analytics. In addition to trading data, DWBIS stores a wide array of non-trading information, including corporate announcements and information related to individual traders and entities. Further, DWBIS can automatically generate a consolidated analysis of trading data for a wide range of market misconduct, including front running, wash sales, marking the close and possible pump and dump schemes. Besides, the report indicated that the implementation of the IOSCO’s secondary and other market principles is generally high across most of the member jurisdictions that the committee reviewed. While the status of implementation varies across jurisdictions, the gaps in implementation have been observed mostly in nascent and emerging market jurisdictions. The report is based on a review of 40 IOSCO member jurisdictions from both emerging and advanced markets. It is aimed at establishing a global overview of the status of implementation of each of the five secondary and other market principles by participating member jurisdictions, based on their self-assessments.