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ARTICLE · 28 MAY 2019

SEBI On The Reporting Of Artificial Intelligence And Machine Learning Systems

Khurana & Khurana, Advocates and IP Attorneys
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Therefore, the SEBI should be circumspect while introducing reporting requirements for Financial Institutions in areas like Artificial Intelligence/ Machine Learning.

IndiaTechnology
Anant Joshi
Anant Joshi
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The Securities & Exchange Board of India released three circulars1, on the 4th of January, 31st of January and most recently 9th of May owing to the increased usage of Artificial Intelligence & Machine Learning (AI & ML) Systems as product offerings. The Circulars increased reporting requirements for Market Intermediaries (MIs), Market Infrastructure Institutions (MIIs), Mutual Funds (MFs), while being labelled as a survey and the creation of an inventory of the landscape of such technology, to gain an in-depth understanding and ensure preparedness for AI/ML policies in the future.

Recognising that most AI/ML systems are black-boxes,i.e they can be viewed in terms of their inputs and outputs, without any knowledge of their internal workings,2 SEBI warned intermediaries against misrepresenting the benefits of any financial products involving the use of AI & ML Technologies.

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