Securities market regulator SEBI, on Saturday, will discuss a number of issues, including the preferential trading case against the National Stock Exchange (NSE), amendment of debenture trustee norms, measures taken during outgoing Chairman UK Sinha’s tenure and listing rules for market infrastructure institutions.
The SEBI board meeting will be held in New Delhi where Finance Minister Arun Jaitley is also expected to be present. Various financial sector reforms proposed in the Union Budget 2017-18 will also be discussed.
According to sources, the market regulator may review Deloitte’s report on the algorithmic trading systems at the NSE and whether the system could have provided preferential trading access to certain brokers.
In 2015, allegations first surfaced that the algorithmic trading systems at the stock exchange were being manipulated so that some brokers had preferential access to market data, giving them an advantage. PTI reports that the CBI has also sought details from SEBI on the matter. The investigation is significant, coming ahead of NSE’s initial public offer. The investigations against its systems are cited as a risk factor in the offer documents.
At the meeting, SEBI is also likely to look at listing rules for market infrastructure institutions. According to Stock Exchanges and Clearing Corporation Regulations (SECC ), only “fit and proper” persons are permitted to acquire or hold shares in a stock exchange. A person is deemed to be “fit and proper” if he has a general reputation and record of fairness and integrity besides not having been convicted for any kind of offence.