Sebi

Analysis of SEBI Guidelines On
Mobile Trading

Compiled By:
Shuchi Sharma
2009-2011

Contents
Mobile Trading 3
Introduction 3
SEBI Framework 4
Framework 4
Application for Permission by Brokers 4
Analysis 6
Extension of Internet Guidelines 6
The Face of Mobile Trading: Operator or Broker? 6
Speed: Who’s Responsibility? 6
Security & Authentication 6
Know Your Client 7
Payment 7
Modification and Cancellation of Orders 7

Mobile Trading
Introduction
Mobile trading refers to share trade through mobile handset. Though it is not yet authorized by SEBI but certain institutes do allow their customers this facility. Regulatory body SEBI has taken first step in this direction and has developed a frame work around it. This report is an analysis of the same framework.
On Thursday, May28th, 2009 SEBI announced that it would see if its trading framework on the internet could be extended to wireless technology. That means that the mobile trading guidelines will necessarily be an extension to already existing internet trading guidelines which were issued in January 2000.   Such trading will, of course, be subject to several safeguards and rules. Further SEBI had invited comments from market players on the rules by June 15.
SEBI guidelines already allow Internet trading through web sites and trading terminals provided by brokers. Almost all big brokers like ICICI Direct, Sharekhan, India infoline, Reliance Money currently provide internet platform for trading and internet stock trading has been a huge success in India.
SEBI has made it clear that only the registered brokers for internet trading will be allowed to extend the facility to handsets. All requirements applicable to internet- based trades will also apply to trade on handsets. For safeguards, SEBI prescribed secure access, end-to-end encryption and security of handset- to- server communication. User identification, authentication and access control could be ensured with user ID,... [continues]

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