Meet Your Structured Digital Database SEBI Compliance Obligations

Meet Your Structured Digital Database SEBI Compliance Obligations

What is the structured digital database (SDD)?

The SDD or Structured Digital Database SEBI is a digital database that must be maintained by every regulated entity (listed companies and market intermediaries). This database maintains a record of people who have access to unpublished price-sensitive information (UPSI) as well as a corresponding history of all their trades. The board of directors have been made directly responsible for maintaining such a database under regulation 3(5) of the SEBI (Prohibition of Insider Trading) Regulations, 2015. This database also records the name of persons with whom such information is shared along with their permanent account numbers (PAN). The SDD Structured Digital Database cannot be outsourced and must be maintained internally with adequate internal controls and checks  such as time stamping and audit trails to ensure non-tampering. 

The Structured Digital Database SEBI obligations are intended to prohibit insider trading. As such, SDD Structured Digital Database SEBI compliance software becomes necessary to ensure compliance with the applicable obligations under the 2015 regulations. The regulations also lay down the obligation of ensuring that the database is maintained in a tamper-proof manner with limited access. SEBI holds the power to access and investigate the SDD of any company or market intermediary in order to verify their compliance with insider trading regulations.

What are the key requirements of the Structured Digital Database?

Under Regulations 3(5) and 3(6) of the SEBI (Prohibition of Insider Trading) Regulations, 2015, an SDD must meet the following criteria:

The database must be maintained internally. It cannot be outsourced to a third party.

The database must have adequate internal controls and checks such as time stamping and audit trails to ensure non-tampering of data

All the entries must be preserved for a period of at least 8 years after the relevant transaction has been completed 

If the company receives any information from SEBI about any investigation or enforcement proceedings, the relevant information in the Structured Digital Database must be preserved till the completion of such proceedings

Who can access the SDD and where can it be hosted?

If a person is allowed to access any UPSI, he/she is allowed to access the Structured Digital Database. Furthermore, the database must be maintained on the company’s internal server. If the database is maintained on a cloud server, it will be classified as ‘outsourced’ and will be a violation of regulation 3(5).

For there to be sustained economic growth and long-term wealth creation in the country, the capital markets must deepen. Consequently, it is necessary to protect the integrity of capital markets as they are critical in India’s journey to becoming a $10 trillion economy by 2030. All listed companies and market intermediaries need to be aware of their role in fostering trust and accountability in the market. It is in pursuit of this very objective that insider trading regulations play a vital role. All KMPs must familiarise themselves with these regulations and create a culture of compliance towards the larger goal of building free, fair and transparent markets in the country. 

What an Structured Digital Database compliance software must have?

The Structured Digital Database SEBI compliance software that you use must be able to provide all the abovementioned features. In addition, the software must also provide certain quality-of-life features that can make compliance easier:

Customized reports: Generate customized reports of the data stored in the SDD

Master data of DP, UPSI, Auditor, and Company: The database needs to be able to record the details of designated persons, UPSI, auditors, and the company via a Master Data feature

Easy to use: The software should be usable even by non-technical people and be user-friendly

The software should have sufficient features and internal controls to ensure that the data cannot be tampered with by unauthorized persons. By way of timestamping, and audit trails among others, there should be no tampering of data possible.

Companies can avoid legal ramifications and boost investor trust by keeping an SDD. As a result, it is critical for businesses to use SDD compliance software in order to comply with SEBI laws and promote a fair and transparent stock market.


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