SEBI Proposes IT Capacity Norms for Commodity Derivatives Exchanges

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  • Last Updated on 3 July, 2025

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SEBI Capacity Planning Guidelines

Draft Circular; Dated: 30.06.2025

1. Background – Role of MIIs and Importance of IT Infrastructure

Market Infrastructure Institutions (MIIs) such as stock exchanges, clearing corporations, and depositories play a critical role in ensuring the smooth functioning of financial markets. A key component of their reliability and resilience lies in the robustness of their IT systems, especially for handling real-time transactions, data flows, and market surveillance.

2. SEBI’s Proposal for Revised Guidelines

The Securities and Exchange Board of India (SEBI) has proposed revised guidelines aimed at enhancing the capacity planning and real-time performance monitoring of MIIs, particularly those dealing in commodity derivatives.

3. Key Proposal – Installed IT Capacity Benchmark

Under the proposed framework, SEBI has recommended that the installed IT system capacity of MIIs operating in commodity derivatives be initially set at twice the projected peak load. This ensures that the infrastructure can handle extreme volumes, maintain system integrity, and prevent outages during periods of high market volatility.

4. Extension of Existing Guidelines to Commodity Derivatives Exchanges

Currently, equity exchanges are required to follow SEBI’s guidelines related to:

  • Capacity planning to ensure scalability of systems
  • Real-time performance monitoring to track and respond to system load and latency issues

SEBI now proposes that these existing guidelines be extended to commodity derivative exchanges as well. This step aims to harmonise regulatory standards across all market segments and strengthen the resilience of IT systems across the board.

5. Benefits of the Proposed Revisions

  • Enhanced Market Stability – By ensuring MIIs have the capacity to handle sudden spikes in transaction volume.
  • Operational Continuity – Minimises risk of downtime and system failures during peak trading.
  • Regulatory Uniformity – Creates a level playing field across equity and commodity markets.
  • Proactive Risk Management – Allows MIIs to identify and address performance bottlenecks in real time.

6. Conclusion

SEBI’s proposal marks a significant step towards reinforcing the technological backbone of India’s commodity markets, aligning them with the more mature equity markets. By mandating scalable capacity and real-time performance monitoring, SEBI aims to bolster investor confidence and market resilience in an increasingly digital and high-volume trading environment.

Click Here To Read The Full Circular

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied