Sebi asks exchanges to set up Investor Risk Reduction Access platform

“A joint platform to provide Investor Risk Reduction Access (IRRA) service shall be developed by the exchanges to provide the investors an opportunity to square off/close the open positions and/or cancel pending orders in case of disruption of trading services provided by the trading member,” Sebi said in a circular.

As per the provisions, trading members, upon facing technical glitches which lead to disruption of trading services, can request for enablement of the IRRA service.

The markets regulator asked the stock exchanges to monitor the parameters like connectivity, order flow, social media posts etc. and suo moto initiate the enablement of the service, if needed, irrespective of any such request by the trading member.

The trading member will continue to be responsible for all the activities on the IRRA with respect to all obligations including settlement and margin requirements, Sebi said.

It further said that the stock exchanges will design a detailed framework for reverse migration from the IRRA system to the trading member’s trading system, as and when the trading system is revived successfully and a request is made in this regard.

The capital markets regulator director exchanges to carry out credible and periodic testing of the IRRA platform from time to time for smooth functioning of the service.

It has asked stock exchanges and clearing corporations to put in place appropriate systems by October 1, 2023.