The Securities and Exchange Board of India has received nearly 20,000 comments on a consultation paper seeking views on closing auction sessions (CAS), market timings and settlement methods for derivative contracts. This number is much higher than the number of approximately 3,500 comments reported in some sections of the media. According to the latest data available with the regulator, around 20,000 comments were received till 7 pm on October 3, the last date for submission of feedback on the consultation paper. SEBI gave this information on X. The regulator’s consultation paper was released on 12 September.
SEBI received 6,000 comments on a consultation paper in 2024 suggesting measures to curb excessive activity in the futures and options (F&O) market; This time the number of responses received is three times more than that. SEBI released this new consultation paper after initial experience with the CAS framework. CAS framework for F&O stocks was implemented from August 3, 2026. The regulator is seeking feedback on seven proposals, including the derivatives settlement mechanism, market timing and some operational aspects of closed auctions.
SEBI’s new consultation paper released
After initial experience with the CAS framework, SEBI has released a new consultation paper. This structure was introduced for F&O stocks from August 3, 2026. The regulator is seeking feedback on seven proposals, including the derivatives settlement mechanism, market timing and some operational aspects of closed auctions. For expiry-day settlement of derivatives, SEBI has suggested two options. The first option is the ‘Blended Volume-Weighted Average Price’ (VWAP), which is based on trades during the last 30 minutes of the ‘Continuous Trading Session’ (CTS) and the 10-minute CAS period. Another option is to continue with only the CTS-based VWAP approach initially, with the possibility of switching to a blended approach based on a review after at least one year.
Some sections of the media have reported the number of comments received on the consultation paper on review of certain aspects of the closing auction session, market timings and settlement methodologies for derivative contracts as 3500, a few days ago. The actual number of comments received till 7:00 PM today i.e. October 3, 2026 is 20,000. #SEBI #CAS
— Securities and Exchange Board of India (@SEBI_updates) October 3, 2026
Two options in the consultation paper
The consultation paper also proposes two alternative market-timing structures, a change in the way indicator values are reported during CAS, a ban on canceling certain limit orders placed outside the reference price by +/- 1 percent and settlement of unexecuted quantities of iceberg orders. According to the regulator’s public-comment portal, the purpose of this consultation process is to gather views and arguments from market participants.
The massive increase in submissions at the end of the consultation reflects the enthusiastic response to the regulatory review of CAS and its integration with the derivatives market. It is now expected that SEBI will examine the feedback received before taking any final decision on the proposed changes. The regulator has also developed a software tool to analyze the feedback and responses received on its consultation paper. Using this tool, a large number of similar responses can also be identified.
