SEBI Proposes 30-Day Lag for Educational Market Data Sharing to Prevent Misuse
SEBI has proposed a uniform 30-day time lag for sharing market price data for educational purposes, replacing the current framework that ranged from one-day to three-month delays. The move addresses stakeholder concerns about data misuse while maintaining educational content relevance. The regulator aims to prevent entities from using live market data under the guise of education while actually providing investment advice, which falls under strictly regulated Investment Adviser and Research Analyst frameworks.
*this image is generated using AI for illustrative purposes only.
The Securities and Exchange Board of India (SEBI) has released a significant consultation proposal regarding the sharing of price data for investor education and awareness initiatives. The market regulator has proposed implementing a uniform 30-day time lag for sharing market data for academic and educational purposes, marking a balanced approach to address growing concerns over data misuse.
Evolution of SEBI's Data Sharing Framework
SEBI's approach to market data sharing has undergone several changes in recent months. The regulator currently permits stock exchanges and market intermediaries to share price data for purely educational purposes, subject to specific time restrictions for entities whose activities focus exclusively on investor education.
The regulatory timeline shows a progressive tightening of controls:
| Period | Restriction | Purpose |
|---|---|---|
| May 2024 | One-day lag for educational use | Prevent misuse of live data |
| January 2025 | Three-month delay for educational entities | Stricter framework implementation |
| Current Proposal | Uniform 30-day lag | Balance protection and relevance |
Addressing Regulatory Overlap Concerns
SEBI has expressed significant concern about entities using live or near-real-time market data under the pretext of education, which can blur the line between genuine educational content and investment advice. The regulator emphasized that using live data for educational purposes falls outside the scope of pure educational activity.
Key regulatory concerns include:
- Analysis of current data to predict future prices
- Activities that effectively constitute investment advisory services
- Overlap with Research Analyst regulatory frameworks
- Potential circumvention of established compliance requirements
The consultation paper specifically noted that such activities fall under the definition of Investment Advisory (IA) and Research Analyst (RA) activities, which are subject to strict regulatory oversight.
Stakeholder Feedback and Balanced Approach
The proposed 30-day lag represents a compromise based on extensive stakeholder feedback. Market participants raised concerns at both ends of the regulatory spectrum, highlighting the challenges of the previous framework.
Stakeholder concerns addressed:
- One-day lag considered too short and prone to misuse
- Three-month restriction made educational content stale and ineffective
- Need for relevant yet protected educational material
- Balance between regulatory compliance and educational value
SEBI stated that a 30-day time lag would sufficiently protect against misuse of exchange data while keeping educational content relevant for genuine learning purposes.
Market Maturity and Compliance Requirements
The regulatory framework reflects the current maturity level of India's financial markets compared to developed exchanges. While established markets like the NYSE offer historical market data products on a T+1 basis, the domestic market faces unique challenges with widespread mis-selling by unregulated financial influencers.
Persons engaged solely in education must comply with prohibitions outlined in the January 2025 circular, including restrictions on activities that could be construed as advisory or recommendation-based. The regulator has identified a concerning trend of individuals and institutions presenting themselves as educators while operating like trading firms, exploiting investors without proper market understanding.
Implementation and Future Considerations
The proposed framework aims to address the rise of entities operating under the guise of financial education while actually providing unregulated investment services. SEBI acknowledges concerns about potential impacts on genuine academic activities and suggests keeping provisions open for legitimate academicians on a case-by-case basis with appropriate safeguards.
The consultation represents SEBI's continued effort to balance investor protection with legitimate educational needs, ensuring that market data sharing serves genuine educational purposes without compromising regulatory integrity.
18
