KATHMANDU, Nov 5: The Securities Board of Nepal (SEBON) has introduced an Information Technology (IT) Policy to strengthen cybersecurity and prevent potential cyberattacks in the stock market.
The policy was introduced following a ransomware attack on Nepal's stock market infrastructure. A cyberattack on a data centre on September 21 had forced the closure of the stock market for the day.
The board said it had prioritised digital security through the new policy to prevent similar incidents from disrupting share trading in the future.
The policy, which came into effect on Wednesday, covers information technology security and emerging technologies related to various stakeholders in the securities market.
Understanding Stock Market
It requires the establishment and management of standardised disaster recovery mechanisms in line with international practices to ensure the sustainable, reliable and secure use of market trading systems, clearing and settlement mechanisms, the central depository system, warehouses and related records.
According to the board, the main objective of the policy is to make the overall performance of the securities and commodity exchange markets more result-oriented, effective, measurable and accountable through the development and expansion of IT infrastructure.
The policy also aims to bring outsourced IT services used by the board, market infrastructure institutions and market participants within a clear legal and technical framework to make their digital infrastructure secure, reliable and accountable.
It proposes establishing and developing an integrated cyber incident reporting portal to improve the monitoring, management and control of cybersecurity incidents in the stock market.
The policy also requires critical stock market infrastructure and businesses to have business continuity plans and disaster recovery plans.
The board said it would move towards establishing a shared data centre with the participation of market infrastructure institutions and market participants, building on the existing data centre that serves as a key part of the securities market infrastructure.
According to the board, the policy seeks to improve the overall performance of securities and commodity markets through the expansion and development of IT infrastructure, making operations more effective, measurable and accountable.
The new policy requires disaster recovery mechanisms based on international standards to ensure the secure use of trading systems, clearing and settlement mechanisms, the central depository system, warehouses and other critical records.
Similarly, outsourced IT services used by the board, market infrastructure institutions and market participants will be brought within a clear legal and technical framework to improve the security and reliability of digital infrastructure.
Under the policy, agreements with external service providers must include service level agreements, data security and confidentiality provisions, liability clauses, audit and inspection rights, and strategies for changing or terminating services.
The board has also announced plans to transform institutional performance through the use of information technology and develop an 'e-SEBON' concept.
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