HO/38/44/12(1)2026-MIRSD-TPD1

3 · 1 Ease of compliance: The eligibility criteria has been streamlined to exclude smaller size stock brokers from the technical glitch framework to reduce overall compliance of such stock brokers.

3 · 2 Exemptions from applicability: The technical glitches which are outside the stock brokers ' trading architecture , glitches that don't directly affect the

3 · 3 Simplifying the reporting requirement: Extension of time for reporting of technical glitches (from one hour to two hours), consideration of trading holiday's while submitting reports and streamlining the reporting requirement from reporting to all the exchanges to a single reporting platform (i.e. Common Reporting Platform)

3 · 4 Rationalised and cost effective based technology requirements: The requirements for the capacity planning, software testing and DR drill have been rationalised based on the size of the stock brokers & their technology dependency .

3 · 5 Rationalisation in disincentive structure: The financial disincentive structure has been rationalised considering the exemptions, type of glitches (major or minor) and the frequency of the occurrences .

5 · 1 "Technical glitch shall mean any malfunction in the electronic system of stock broker, including malfunction in its hardware, software, networks/bandwidth, processes or products or services, directly or indirectly related to trading and risk management, occurred during trading session of stock exchange. The malfunction in the systems of stock brokers or the one outsourced from any third parties, which may lead to either stoppage, slowing down or variance in the trading and risk management functions such as log-in, order placement (including modification, cancelation, execution, confirmation, status), allocation and viewing of margin/ collateral/ funds etc., for a contiguous period of five minutes or more."

5 · 2The above definition of technical glitches is subject to the condition that the following types of technical issues in the system of stock brokers shall not be considered as technical glitches irrespective of the time of occurrence and accordingly need not be reported to Exchanges;

5 · 3Exchanges have introduced financial disincentive structure for occurrence of technical glitches. In this context, financial disincentive structure shall not be applicable for the technical glitches which do not affect the stock broker's ability to provide seamless services to their clients. In case of the following types of technical glitches, the financial disincentive structure shall not be applicable:

6 · Applicability of framework:

6 · 1The framework shall be applicable to the stock brokers providing IBT/STWT trading platforms and having more than 10,000 registered clients (excluding closed accounts) as on 31 st March of previous financial year.

6 · 2Stock exchange shall issue detailed guidelines in this regard and disseminate the list of applicable stock brokers.

7 · Reporting Requirements:

7 · 1Stock brokers shall inform regarding the technical glitch to the stock exchanges and also to their clients within 2 hours from the time of occurrence of the glitch. Exchanges in turn shall disseminate the technical glitch incidents on their website.

7 · 2Stock brokers shall inform their clients regarding the occurrence of technical glitch by disseminating information on their website and any other mode such as SMS/email/pop-up in mobile based/ web based trading application etc .

7 · 3Stock brokers shall submit a Preliminary Incident Report (as per the format prescribed by stock exchanges) to the stock exchange within T+1 day of the incident (T being the date of the incident). However, if T+1 day falls on a trading holiday; submission may be done on next trading day.

7 · 4Stock brokers shall submit a Root Cause Analysis Report (RCA) (as per the format prescribed by stock exchanges) of the technical glitch to stock exchange, within 14 working days from the date of the incident.

7 · 5Stock brokers shall submit information/reports mentioned above , on 'Samuhik Prativedan Manch' i.e. common portal for submissions by stock brokers.

7 · 6All technical glitches reported by stock brokers as well as independently monitored by stock exchanges, shall be examined by the stock exchanges for suitable actions .

8 · Capacity Planning:

8 · 1 Increasing number of investors create additional burden on the trading system of the stock broker and hence, adequate capacity planning is prerequisite for stock brokers to provide continuity of services to their clients. Stock brokers shall do capacity planning for entire trading infrastructure i.e. server capacities, network availability, and the serving capacity of trading applications.

8 · 2Stock brokers shall monitor peak load in their trading applications, servers and network architecture.

8 · 3Stock exchanges shall issue detailed guidelines with regard to capacity planning, peak load, and new capacity required to tackle future load on the system of the stock brokers . The extant guidelines shall be rationalised based on the size of the stock brokers & their technology dependency.

9 · Software testing and change management

9 · 1Software applications are prone to updates/changes and hence, it is imperative for the stock brokers to ensure that all software changes that are taking place in their applications are rigorously tested before they are used in production systems. Software changes could impact the functioning of the software if adequate testing is not carried out resulting technical glitches in such software .

9 · 2Stock exchanges shall issue detailed guidelines with regard to testing of software, traceability matrix, change management process and periodic updation of assets etc. The extant guidelines shall be rationalised based on the size of the stock brokers & their technology dependency.

10 · Monitoring mechanism:

10 · 1 Proactively and independently monitoring technical glitches shall be one of the approaches in mitigating the impact of such glitches. In this context, Stock Exchanges have deployed API based Logging and Monitoring Mechanism (LAMA). Stock exchanges shall continue to monitor the trading systems of the stock brokers through this mechanism.

10 · 2 Stock exchanges shall review the applicable provisions of LAMA and issue detailed guidelines with regard to applicability, key monitoring parameters and preservation of logs etc.

11 · Business Continuity Planning (BCP) and Disaster Recovery Site (DRS):

11 · 1 Stock Exchanges shall review the current guidelines for the applicability of the BCP and DRS. The current guidelines shall be rationalised based on the size of the stock brokers & their technology dependency ensuring the following

14 · This circular shall supersede earlier SEBI circular no SEBI/HO/MIRSD/TPD1/P/CIR/2022/160 dated November 25, 2022.