The authority on capital markets, Sebi, on Wednesday established a common structure for requesting client trading preferences across various exchanges for the same product. Currently, clients who wish to trade on several stock exchanges for a specific segment must submit separate authorizations or letters.
To ensure that clients are allowed, it has been decided to standardise the "Trading Preferences" format based on the comments received and after consulting with stock exchanges.the ability to access all stock exchanges where stock brokers who are registered for the same segment have accounts, according to the regulator.
The new system requires all stock brokers to register their new clients on all of the operational stock exchanges after acquiring their trading preferences in accordance with the format.
Within three months, brokers must notify their clients through email or SMS and provide existing clients with access to all active stock exchanges for the segments they have already chosen in default mode.
The stock brokers will also give their clients the option to decline such access by giving negative consent in this regard. The brokers will then activate or deactivate the segments in accordance with their clients' preferences.
Customers will have the option to decline such access by providing negative consent, and stock brokers will activate or deactivate the segments in accordance with their choice. According to Sebi, the provisions of this circular will take effect on August 1, 2023.
The regulator further instructed the exchanges to conduct internal audits and inspections of stock brokers every six months to ensure that this circular is being implemented and followed, and to report back to the regulator on these findings in their monthly development reports.
