Photo of Rohan Banerjee

Partner in the Financial Regulatory Practice at the Mumbai office of Cyril Amarchand Mangaldas. Rohan has advised a number of global and domestic financial institutions on a wide range of securities law matters including advising on SEBI insider trading as well as market manipulation regulations, representing clients in regulatory contentious matters, advising on M&A in the financial sector, etc. He can be reached at rohan.banerjee@cyrilshroff.com

Recent amendments to the insider trading regime

Since overhauling the insider trading regime with the introduction of the SEBI (Prohibition of Insider Trading) Regulations, 2015 (“PIT Regulations”), the Securities and Exchange Board of India (“SEBI”) has continually sought to fine tune and tweak the regulations through amendments in 2018 and 2019. On July 17, 2020, SEBI notified the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2020 (“PIT Amendment”), to introduce further changes to the PIT Regulations.
Continue Reading Recent Amendments to the Insider Trading Regime

The most valuable commodity I know of is information.

– Gordon Gekko, Wall Street

Over the past few weeks, the Securities and Exchange Board of India (SEBI) has passed three orders[1] (SEBI Orders) in the infamous ‘WhatsApp leak’ saga that has been in the news since November 2017[2]. Holding the impugned perpetrators guilty of violating insider trading regulations, the regulator has taken significant steps in pushing the boundaries of the concepts of insider, UPSI and insider trading.


Continue Reading SEBI and WhatsApp leaks: Every link in the chain matters

Mutual Funds and Alternative Investments - Stewardship Code

Introduction

On December 24, 2019, Securities and Exchange Board of India (“SEBI”) released a circular setting up a stewardship code for Asset Management Companies (“AMCs”), Mutual Funds (“MFs”) and all the categories of Alternative Investment Funds (“AIFs”) investing in listed Indian companies (“Stewardship Code” or “Code”). In keeping with global trends, SEBI has made it necessary for the power wielding cash-rich institutional investors, to act in accordance with the responsibilities that invariably accompany and behoove such powers and formulate a policy adopting the principles enshrined in the Code.

The Stewardship Code prescribes certain principles which, aim at enhancing the responsibilities of the AMCs/ AIFs to protect the interests of their investors/beneficiaries. The requirements pertaining to the Stewardship Code shall come into effect on April 1, 2020.
Continue Reading Being Responsible Corporate Citizens – How Mutual Funds and Alternative Investment Funds will Rise Up to the Stewardship code

Insider Trading Hotline SEBI - Informant Mechanism

In our previous blog post, dated June 12, 2019, we discussed the Securities Exchange Board of India’s (SEBI) efforts to institutionalise an informant mechanism for insider trading, through its discussion paper released in June 2019 (Discussion Paper).

The regulator has now formalised this into law through a recent amendment to the Insider Trading Regulations, which came after a SEBI board meeting approved the informant mechanism scheme on August 21 of last month. Interestingly, while the publicly available agenda of the SEBI board meeting states that it had received comments from certain entities on the Discussion Paper, these comments are not publicly available and are stated to have been excised for reasons of confidentiality.
Continue Reading SEBI launches a new hotline: Introduction of the Informant Mechanism into the Insider Trading Regulations

SEBI’s Latest Discussion Paper on Insider Trading Regulations

Prosecuting insider trading cases has always been a challenge for the Securities Exchange Board of India (SEBI). Primary evidence is difficult to come by, which impacts success rates as well as investigation timelines.

On June 10, 2019, SEBI released a discussion paper (Discussion Paper) proposing amendments to the SEBI (Prohibition of Insider Trading) Regulations, 2015 (Insider Trading Regulations) to establish systems and processes (both within listed companies, as well as, at SEBI) that incentivise individuals to report insider trading violations, if they come to their knowledge. In terms of the Discussion Paper, the informant may be rewarded up to INR 1 crore (approx. USD 150,000) if SEBI undertakes disgorgement of at least INR 5 crores (approx. USD 0.72 million) as a result of any action taken on the basis of true, credible and original information.
Continue Reading Bounty Hunting in Corporate India – Understanding SEBI’s Latest Discussion Paper on the Insider Trading Regulations

RBI’s Fintech Sandbox Proposal Startups

Technological innovation in the financial space, popularly known as ‘fintech’, has been at the forefront of regulatory thinking in recent times and is widely considered to be the panacea to the thorny issues of financial inclusion and ease of access to financial products/solutions, etc.

In 2018, the inter-regulatory Working Group (WG) set up by the Reserve Bank of India (RBI) to review the granular aspects of fintech and its implications, released a report being the ‘Report of the Working Group on FinTech and Digital banking’. One of the WG’s key recommendations was the introduction of an appropriate framework for the creation of a regulatory sandbox (RS) where the RBI could provide the requisite regulatory guidance to test products in a controlled environment.
Continue Reading Learning by Doing? The RBI’s Fintech Sandbox Proposal

Prohibition of Insider Trading Regulations 2015 in India , Amendments

The Securities and Exchange Board of India (SEBI) ended the year with a bang by issuing a number of notifications on December 31, including the SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2018 (PIT Amendment Regulations). The PIT Amendment Regulations come into force on April 1, 2019 and will have significant impact on the manner in which listed companies and intermediaries navigate the market conduct framework.
Continue Reading A New Year Ushers in the Insider Trading Regulations, 2015 Version 2.0

Last month, the Securities Appellate Tribunal (SAT) passed an order in favour of Factorial Master Fund[1] (Factorial). This overturned the order of the SEBI Whole Time Member who had held that Factorial had contravened the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations) by trading in the securities of L&T Finance Holdings Limited (LTFH), while in possession of unpublished price sensitive information (UPSI).

Continue Reading The Sound of SEBI’s Silence: Will the Factorial Order Change the Rules of the Game?