Regulations
SEBI was deeply perturbed about regulatory flaws exposed by Whistleblower's letter, reveals RTI
After receiving a letter from a Whistleblower in January, SEBI felt it was time to urgently have a "basic regulatory framework" for co-location services
 
Market regulator Securities and Exchange Board of India (SEBI), after receiving a letter dated 14 January 2015 from a Whistleblower alleging dubious practices followed for co-location services by a stock exchange, felt that there was a need to 'urgently have a basic regulatory framework for co-location services', reveals a reply received under the Right to Information (RTI) Act.
 
According to the reply received from the market regulator, a note dated 26 February 2015 from its Market Regulation Department- Division of Policy shows that there were no specific regulatory requirements prescribed by SEBI on co-location facility. It says, "...at present, there are no specific regulatory requirements prescribed by SEBI that stock exchanges are required to adhered to while providing co-location facility to the stock brokers."
 
"In view of the allegations made in the letter of xxx (name withheld by SEBI), it is felt that there is an urgent need to have a framework for regulating the activity of co-location. While the proposal related to two-queue architecture may be further debated, the requirement to ensure 'Fair and equitable access to the co-location facility' and 'integrity and security of the data and trading systems' may be issued," the note says. 
 
It may be recalled that Sucheta Dalal, Managing Editor of Moneylife also received a copy of the letter from the Whistleblower at the same time. After waiting for almost four months and doing thorough research, she sent the letter to SEBI seeking information on action taken by the market regulator, if any. There was no response from SEBI.
 
According to the reply received under the RTI, in a note on 3 March 2013, SEBI has stated that Indian exchanges, either on their own or through third parties were offering the facility of colocation. Here is what SEBI stated in the note prepared by its Market Regulation Department- Division of Policy…
 
i. “NSE: Vide circular dated August 21, 2009, NSE has allowed informed that it will provide co-location facility to its members for their DMA and ALGO IT infrastructure at its premises.
ii. BSE: Co-location facility is being offered by the stock exchange through a third party IT Service Provider (Netmagic Solutions Pvt. Ltd.)
iii. MCX-SX: Vide circulars dated December 23, 2011 and December 07, 2012, MCX-SX has allowed its member to use co-location/ proximity hosting.”
 
As per MarketBeat blog on Wall Street Journal , while a "multitude of data is being transferred from exchange to exchange and then onto a trader’s computer, high-frequency and other traders can access prices a split second faster through direct feeds. This practice is known as collocation, and it’s employed by nearly every exchange in the US. For a fee, trading firms are allowed to place their trading computers in the same data centres that house an exchange’s computer servers. With sophisticated models built into these trading computers and little oversight on the exchange itself, the computers are almost guaranteed to be the first on any order should they choose to act on."
 
Here is the reply received from SEBI under the RTI Act...
 

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COMMENTS

nilesh prabhu

1 year ago

money life voice is heard

Vivek

1 year ago

Sebi is not going to do anything as it was controlled by big manipulators. But still suchetaji is fighting with these big manipulators. Much appreciated suchetaji.....

Vivek

1 year ago

Sebi is not going to do anything as it was controlled by big manipulators. But still suchetaji is fighting with these big manipulators. Much appreciated suchetaji.....

Pushpesh Kumar Sharma

1 year ago

great story.
true to its logo, 'know what's coming' moneylife is going strong
pushpesh kumar
bathinda

Saradha scam: CBI grills Trinamool leader
West Bengal's ruling Trinamool Congress' state general secretary Shankudeb Panda was on Wednesday interrogated by the CBI in connection with the Saradha scam.
 
Summoned by the CBI, Panda, earlier attached to the Saradha Group as a journalist, appeared before the agency office in the morning.
 
"He is being questioned about his involvement with the Saradha group," said a CBI officer. 
 
The journalist-turned-politician was grilled in December last by the Enforcement Directorate which too is probing the multi-crore scam in which several Trinamool leaders have been indicted.
 
Former state transport minister and senior Trinamool leader Madan Mitra is currently behind bars for his alleged complicity in the scam.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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New IPR policy to boost innovation, patent filings
While domestic applications to the Indian patents office had remained low at about one-fifth of the total filings, a new policy on intellectual property rights (IPR) should help the situation, a top official said on Wednesday.
 
"I am concerned that domestic filings of patent applications have remained static in the past few years at about 20 percent of total filings," Amitabh Kant, the secretary of Department of Industrial Policy and Promotion (DIPP), said here at an IPR Conference hosted by the Confederation of Indian Industry (CII).
 
"Considering that the country has one of the largest reservoirs of scientists and technologists, it seems extremely unjustified that the levels of patent filings are still fairly low," he said, adding there was need to widen the awareness about intellectual property (IP) in the country.
 
The national Intellectual Property Rights (IPR) policy, currently being prepared, would help India become an innovative economy over the next decade, he said.
 
"We expect it to be a visionary document that can guide the journey of India towards becoming an innovative economy in the next 10 years." 
 
A draft policy was placed in the public domain, inviting comments from stakeholders and others interested, he added.
 
Kant, however, stressed the importance of creating an innovative ecosystem which would support translation of inventions into commercial use.
 
"This innovation ecosystem can only be created and nurtured through initiatives of the government in collaboration with industry," the secretary said.
 
He also urged organisations to protect their trademarks as it would help them leverage their brand value towards development of the business.
 
Kant said Indian IPR laws were amended in compliance with the World Trade Organisation, which had led to a comprehensive, legislative, administrative and judicial framework to safeguard IPRs.
 
He also said that the government has taken several measures to improve the delivery of services provided by IP office, such as processing of applications.
 
Nearly 250,000 patent applications and 532,000 trademark registrations are pending with the government owing to shortage of manpower.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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