Submit risk-based data by May 31: Bourses to brokers

Leading stock exchanges BSE and NSE today asked brokers to submit risk-based supervision data for the past fiscal by May 31 in order to avoid any penalty or disciplinary action.
The exchanges introduced the new risk-based model for supervision of market entities following markets regulator Sebi's directions.
Trading members have been submitting risk-based supervision data since 2013-14. However, there have been instances of delayed or non-submission of data.
Accordingly, the exchanges in consultation with Sebi have formulated a standard penalty structure for the non/delayed submission of RBS data, which will be applicable for the data for 2015-16 onwards.
Earlier this month, the exchanges had extended the time for submission of risk-based supervision data by brokers for the past fiscal. Prior to that, brokers were required to submit the data by May 15.

"The members are advised to submit the data by May 31, 2016, in order to avoid any penalty or disciplinary action," BSE said in a circular today.

In a separate circular, NSE said "all members are advised to ensure the submission is made positively by the due date to avoid any penal charges/disciplinary action".
The exchanges have also put in place a graded penalty mechanism, with fines starting from Rs 10,000 for brokers who fail to make timely submission of risk-based supervision data, and prolonged non-compliance will result in disablement of trading terminals.
The Securities and Exchange Board of India (Sebi) decided to adopt this new supervision model, based on level of risks posed by a market entity, to help it better regulate the marketplace and strengthen its surveillance system.

Under the model, various market entities are divided broadly into four groups -- very low risk, low risk, medium risk and high risk -- and the quantum of surveillance and number of inspections would increase as per the risk level.
The move helps the surveillance system take care of most of the smaller offences so that the investigation resources are utilised more effectively to tackle serious violations in the market place. The data collated from the members towards risk-based supervision will be shared with Sebi.