[06th February 2025] In
exercise of the powers conferred by section 30 of the Securities and Exchange
Board of India Act, 1992 (15 of 1992) the Board hereby makes the following
regulations to further amend the Securities and Exchange Board of India
(Intermediaries) Regulations, 2008, namely: - These
regulations may be called the Securities and Exchange Board of India
(Intermediaries) (Amendment) Regulations, 2025. They
shall come into force on the date of their publication in the Official Gazette. In
the Securities and Exchange Board of India (Intermediaries) Regulations, 2008,
after Chapter IIIA and before Chapter IV, the following Chapter shall be
inserted, namely, - "CHAPTER IIIB USAGE OF ARTIFICIAL INTELLIGENCE 16C. Responsibility for the use of artificial
intelligence. (1)
Any person regulated
by the Board who uses artificial intelligence and machine learning tools and
techniques, either designed by it or procured from third-party technology
service providers, irrespective of the scale and scenario of adoption of such
tools for conducting its business and servicing its investors, shall be solely
responsible - (a)
for the privacy,
security and integrity of investors and stakeholders data including data
maintained by it in a fiduciary capacity throughout the processes involved; (b)
for the output
arising from the usage of such tools and techniques it relies upon or deals
with; and (c)
for the compliance
with applicable laws in force. (2)
The Board may, in
case of violation of the provisions of sub-regulation (1), take such action as
it may deem fit including action under Chapter V of these regulations. Explanation:
For the purpose of this regulation, - (a)
the expression
"artificial intelligence and machine learning tools and techniques"
may include any application or software program or executable system or a
combination thereof, offered by the person regulated by the Board to investors/stakeholders
or used internally by it to facilitate investing and trading or to disseminate
investment strategies and advice or to carry out its activities including
compliance requirements and the same are portrayed as part of the products offered
to the public or under usage for compliance or management or other business
purposes; (b)
the expression
"person regulated by the Board" shall have the same meaning as
provided under Explanation 1 to regulation 16A."Securities
And Exchange Board Of India (Intermediaries) (Amendment) Regulations, 2025
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