India’s securities regulator has ordered the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) to act as alternative trading venues for each other when outages or technical glitches occur.
The move, which will begin in April next year, is to protect investors from price risks during trading halts, the Securities and Exchange Board of India (Sebi) says in a circular on November 28.
The regulator laid out the procedure that the bourses must follow if either one is hit by glitches or outages. The affected bourse must within 75 minutes inform Sebi and the other bourse, which has to put the alternative trading venue plan into action within 15 minutes.
Sebi has asked the exchanges to prepare a joint standard operating procedure for the move and submit it to the regulator within the next two months.
The NSE is the largest of India’s seven stock exchange by market capitalisation, with more than 1,600 listed companies. The BSE is India’s oldest bourse with over 5,000 listed firms.