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Nasscom's feedback to SEBI on Consultation paper on Recognition as Specified Digital Platform
Nasscom's feedback to SEBI on Consultation paper on Recognition as Specified Digital Platform

November 27, 2024

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SEBI released a Consultation Paper on Recognition as Specified Digital Platform (Draft Circular) on October 22, 2024, that proposed the criteria for a digital platform to be recognised as a Specified Digital Platform (SDP). In response to SEBI's public consultation on the Draft Circular, nasscom provided industry feedback via our submission (attached below). Here are our overall observations on the proposed approach in the Draft Circular:

  • The correlation between the proposed approach as per the Draft Circular, and the problem of addressing “concerns related to unregistered entities and claims which are not permitted by SEBI”, is not clear.
  • There is no domestic or global precedent for an approach where obligations are imposed on digital platforms to proactively and pre-emptively screen all content related to securities.
  • The proposed approach imposes disproportionate obligations on platforms which can have unintended consequences.
  • The implementation of the requirements for SDP recognition poses certain operational challenges for digital platforms.
  • There are existing regulatory mechanisms, including resources for education and awareness, which SEBI should effectively leverage to tackle misleading securities claims. 

As against the proposed approach, we recommended a combination of effective enforcement of existing laws and regulations, strengthening SEBI’s enforcement capacity, including coordination with other regulators and government agencies, and an increased focus on investor education and awareness to equip retail investors to make sound investment decisions. 

For any queries regarding this submission, please write to Ananya Marie Moncourt (ananya@nasscom.in) or Nalini Negi (nalini@nasscom.in).


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20241126_SEBI_SDP_nasscom.pdf

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