Rules / India

SEBI (Intermediaries) (Amendment) Regulations, 2025 – Regulation 16C: Responsibility for the use of artificial intelligence

In forceRegulationBinding

Makes every SEBI-regulated person that uses AI/ML tools – whether built in-house or bought from third parties – solely responsible for investor data privacy and security, for the outputs of those tools, and for compliance with applicable law. Parallel amendments apply to stock exchanges/clearing corporations and depositories.

Why it matters

Brokers, advisers, fund managers and market infrastructure cannot shift liability for AI outputs to vendors.

What it requires

Data governanceHuman oversight

Penalties

Action under the SEBI Act and Intermediaries Regulations (no AI-specific amount).

SourceSEBI: https://www.sebi.gov.in/legal/regulations/feb-2025/securities-and-exchange-board-of-india-intermediaries-amendment-regulations-2025_91809.htmlSecondary: https://www.sebi.gov.in/reports-and-statistics/reports/jun-2025/consultation-paper-on-guidelines-for-responsible-usage-of-ai-ml-in-indian-securities-markets_94687.html Checked against the source on 4 Oct 2026. Gazetted 10 Feb 2025 (dated 6 Feb), effective on publication. SEBI's separate draft 'Guidelines for responsible usage of AI/ML in Indian securities markets' (consultation paper 20 Jun 2025) had not been finalised as of mid-2026. SEBI consulted on the amendment in Nov 2024.

Cite this record

SEBI (Intermediaries) (Amendment) Regulations, 2025 – Regulation 16C: Responsibility for the use of artificial intelligence. Securities and Exchange Board of India (SEBI). Status: In force. wheresthe.ai, https://wheresthe.ai/rule/in-sebi-ai-responsibility-reg-16c-2025/ (verified 4 Oct 2026).

Line of Thought

Developments connected to this rule

What has happened that this rule shapes, or that shapes it. Pick one to keep following the thread.

More from India