What Changed
The April 2026 SEBI circular extended mandatory compliance requirements to all algorithmic trading systems — retail and institutional alike. If you're placing orders through a broker API using any form of automation, these rules now apply to you.
The three core requirements are static IP registration, order identification tagging, and audit trail retention.
Static IP Registration
Algo systems must originate orders from a registered, static IP address that has been submitted to and approved by your broker. This is a one-time registration process that brokers have formalized through their vendor and partner API programs.
Dynamic residential IPs are not eligible. You need a dedicated IP that doesn't change. The practical implication: if you're running automation from a home internet connection or a standard cloud server with a shared IP pool, you'll need to upgrade to a dedicated static IP solution before your orders will be accepted at the gateway level.
Order Tagging
Every order placed through an algo system must carry a tag identifying it as algorithmic in origin. This is handled at the API request level — your broker's documentation will specify the exact field and acceptable values. Untagged orders from registered algo systems are rejected automatically. This is non-negotiable and enforced at the gateway.
Audit Trail Requirements
All order activity — placements, modifications, cancellations, fills, and rejections — must be logged and retained for a minimum of five years. These logs must be structured enough to be produced on demand for regulatory inspection.
This means keeping proper records of your system's decision logs, not just your broker's trade history. The trail needs to show what signal triggered each order.
What This Means for Retail Traders
Compliance isn't optional and brokers are enforcing it at the API level. The good news is that the technical requirements are straightforward — static IP, tag your orders, keep your logs. If you're using a trading SaaS platform, ensure it handles all three on your behalf before connecting your account.
TradeSphere and SEBI Compliance
TradeSphere was designed from the ground up with these requirements in mind — including static IP routing for Indian markets, automatic order tagging, and a full audit log for every market action across NSE/BSE, US, and Canadian markets.