Reporting for Artificial Intelligence (AI) and Machine Learning (ML) applications and systems offered and used by Market Infrastructure Institutions (MIIs)
Summary
SEBI mandates Market Infrastructure Institutions to report on the use of Artificial Intelligence and Machine Learning applications. The reporting obligation requires submitting a specific form quarterly within 15 days of the quarter's end. The circular defines the scope of AI/ML technologies and provides detailed annexures for classification and reporting formats.
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SEBI is conducting a survey and creating an inventory of the AI / ML landscape in the Indian financial markets to gain an in-depth understanding of the adoption of such technologies in the markets and to ensure preparedness for any AI / ML policies that may arise in the future.
Any set of applications / software / programs / executable / systems (computer systems) – cumulatively called application and systems, to carry out compliance operations / activities, where AI / ML is used for compliance or management purposes, is included in the scope of this circular.
Technologies that are considered to be categorized as AI and ML technologies in the scope of this circular, are explained in Annexure A.
All MIIs shall fill in the AI / ML reporting form (Annexure B) in respect of the AI or ML based applications or systems as defined in Annexure A offered or used by them, and submit the same in soft copy only at specified email addresses to SEBI on a quarterly basis within 15 days of the expiry of the quarter, with effect from quarter ending March 31, 2019.
This circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act 1992, read with Section 10 of the Securities Contracts (Regulation) Act, 1956 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
This circular is available on SEBI website at www.sebi.gov.in at “Legal Framework→Circulars”.
Source: SecMarx — Reporting for Artificial Intelligence (AI) and Machine Learning (ML) applications and systems offered and used by Market Infrastructure Institutions (MIIs). Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.