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SEBI and stock exchanges launch the Investor Risk Reduction Access platform

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The SEBI person, Smt. Madhabi Puri Buch recently unveiled the Investor Risk Reduction Access (IRRA) platform at BSE India. The stock markets represent an important piece of architecture in the Indian capital markets and hence technical glitches or outages on a broker’s end which disrupt trading services have can have serious repercussions for investors and on markets as a whole. The IRRA which stems from the collaboration of the Market Infrastructure Institutions – BSE India, NSE India, Metropolitan Stock Exchnage of India, Multi Commodity Exchange of India, NCDEX – (MIIs) under the guidance of SEBI provides a solution for managing investors’ trading transactions in the event of such disruptions.

SEBI formally introduced the IRRA framework on December 30, 2022 as part of its ongoing efforts to enhance investor protection. Readers may read more on the SEBI circular in a previous post by Regstreet Law Advisors at: https://lnkd.in/dru9nMGu.

The MIIs soft-launched the IRRA platform on October 03, 2023, and he platform was officially launched at BSE yesterday for the benefit of investors at large.

As a joint platform provided by all the exchanges, IRRA allows traders to square off existing positions and cancel pending orders when a broker faces technical glitches / cyberattacks, rendering their systems inaccessible at both primary and disaster recovery sites. The operational process of IRRA is as follows:

1. In the event of a trading disruption, the affected broker can request the activation of IRRA.

2. The IRRA platform downloads all trades and pending orders from all trading venues associated with the affected broker.

3. IRRA then sends SMS and email notifications to all clients of the affected broker, providing a link to the IRRA platform.

4. Clients can access the IRRA platform via the provided link to close out open positions and cancel pending orders, thereby mitigating potential risks associated with the broker’s technical issues.

It’s important to note that the IRRA system is available to the trading members supporting Internet-based trading and Security Trading through Wireless Technology for their investors and does not cater to algo trading and institutional clients. Additionally, it only facilitates squaring off positions and canceling pending orders; traders cannot open fresh positions using the IRRA platform. Therefore, the platform serves as a safety net in situations where investors face market risk due to a broker’s downtime.

The BSE media release on the same can be accessed at: https://lnkd.in/dZiEqmTj

Readers are welcome to share their views with Regstreet Law Advisors at info@regstreetlaw.com.

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