SEBI to announce new insider trading norms soon
New Delhi: In its efforts to make listed firms more responsible towards investors, SEBI may announce new insider trading norms as early as next week and also revamp the listing as well as delisting regulations.
The changes are being made after taking into account suggestions made by the industry and other stakeholders —— including market entities and investors —— and are aimed at protecting the interest of minority investors without making the regulatory compliance cumbersome for the companies.
These new norms — to check insider trading menace, to enforce better compliance to continuous listing regulations and to revamp delisting norms for a faster and easier process for those desiring to delist from the stock market — will be put up for approval of SEBI's board in its next meeting.
Sources said that the final sets of regulations in all these areas may be in place this month itself, beginning as early as next week.
The proposed tightening of norms assumes significance in the wake of Sebi coming across cases of insider trading at not just small companies, but at big corporates as well.
Besides, another set of new regulations would help Sebi take prompter and stricter action against the entities found to be violating listing norms.
“We are revising our prevention of insider trading regulations because we have discovered cases ... unfortunately the cases are not just from small companies but also from big ones,” SEBI Chairman U K Sinha recently said.
The new insider trading norms, which would replace nearly two—decade—old rules in this area, would be substantially based on recommendations of an expert committee constituted by the Securities and Exchange Board of India (Sebi) and the suggestions made thereafter to this panel's draft proposals.
The panel, chaired by former Chief Justice of Karnataka and Kerala High Courts, K Sodhi, was set up to review the Sebi (Prohibition of Insider Trading) Regulations, 1992.