Securities Law

Securities Markets Code, 2025: Simplifying the fault line

Summary: The Securities Markets Code Bill, 2025, introduced Clause 92 and Clause 93 as parallel provisions to govern fraudulent and unfair practices and market abuse, respectively. The Parliamentary Standing Committee, in its recently released report on the Bill, found that the distinction between the two clauses was unclear, and allowing the Securities and Exchange Board of India to expand the definition of criminal market abuse through delegated legislation raised serious constitutional concerns. The Committee has recommended a series of targeted amendments to Clause 93 to confine criminal liability to conduct that is grave, willful, and systemic in nature, to delete the residuary rule-making power under Clause 93(g), and to ensure that these changes are carried through into the Prevention of Money-Laundering Act, 2002, schedule. This blog examines each of these recommendations and their practical significance for market participants, intermediaries, and their advisors.

Continue Reading Securities Markets Code, 2025: Simplifying the fault line
Large Issuers, Easier Listings: MPO and MPS Norms Recast Under SCRR

Summary: This article examines the Securities Contracts (Regulation) Amendment Rules, 2026 (“Amendment Rules”), which recalibrate the minimum public offer and shareholding framework under the Securities Contracts (Regulation) Rules, 1957 (“SCRR”). It discusses the key changes, including materially reduced dilution requirements and extended compliance timelines and highlights the legal and operational considerations arising from the amendment for both unlisted and listed large issuers.

Continue Reading Large Issuers, Easier Listings: MPO and MPS Norms Recast Under SCRR

Ever since the introduction of framework for prevention of insider trading (“PIT”), the Securities and Exchange Board of India (“SEBI”), as the primary regulator of securities markets has consistently been sharpening its tools to effectively discharge its duty of ensuring market integrity, curbing malpractices and safeguarding interests of investors.

Continue Reading Decoding SEBI’s Tech Arsenal for Insider Trading: Structured Digital Database (Part I)

SEBI

Background

In order to provide for an alternative and efficient dispute resolution mechanism for securities law violations, the Securities and Exchange Board of India (“SEBI”) introduced the consent mechanism through a circular in 2007[1] (which was partially modified in 2012)[2]. This was subsequently codified through the SEBI (Settlement of Administrative and Civil Proceedings) Regulations, 2014 (“2014 Regulations”), pursuant to the notification of the Securities Laws (Amendment) Act, 2014, which expressly empowered SEBI to settle matters with a view to removing any ambiguity over the validity of the settlement process. This regime specifically excluded certain serious violations (e.g. insider trading, fraud) from the purview of the settlement mechanism. Explicit provisions which enabled initiation of settlement proceedings prior to the issuance of show cause notice were also introduced, to reduce administrative burden and cost on SEBI.Continue Reading Amendments to SEBI Settlement Regime – A Snapshot

Duly Noted” Notice period for subsequent sale notice under Rule 8 and 9 of the Security Interest (Enforcement) Rules, 2002 relaxed by the Supreme Court.

Introduction

A three-judge bench of the Supreme Court, in S. Karthik & Ors. v. N. Subhash Chand Jain & Ors.[1](“S. Karthik”), recently relaxed the mandatory pre-requisites prescribed for sale of mortgaged assets under the Security Interest (Enforcement) Rules, 2002 (“The SI Rules”), under certain circumstances. It was held that when a sale notice under the SI Rules does not result in a sale due to reasons entirely attributable to the borrower, then the lender need not wait another 30 days before selling the mortgaged assets through a subsequent sale notice. This decision assumes significance as it is indicative of a lender friendly approach in monetising their security interests by adopting a flexible standard in interpreting the procedural prerequisites, rather than reading them pedantically. This blog examines the judgement in detail.Continue Reading “Duly Noted”: Notice period for subsequent sale notice under Rule 8 and 9 of the Security Interest (Enforcement) Rules, 2002 relaxed by the Supreme Court

Post-IPO financial results

Under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (“SEBI Listing Regulations”), listed companies are required to submit their financial results within 45 days of end of each quarter, other than the last quarter of a financial year where they have 60 days.Continue Reading Post-IPO financial results – when to disclose

Major Impetus to IPO Rush

Despite the challenging times, the Indian capital markets are hitting all-time highs on a daily basis and have been flooded with capital. This has seen a rush of equity offerings over the last 12 months including record filings for draft documents over the last few months. In their continuous efforts to make India exchanges more competitive, the Securities and Exchange Board of India (“SEBI”) has notified the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2021 (“ICDR Amendment”). Pursuant to the ICDR Amendment, SEBI has revisited some of the requirements relating to lock in of equity shares post-IPO (one of the oldest requirements of SEBI), as well as the concept of  promoter group and group companies under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended (“ICDR Regulations”).Continue Reading Major Impetus to IPO Rush

Extra-territorial application of India’s securities law – Has SEBI cast its net too wide?

“If a connection exists, it is for the Legislature to decide how far it should go in the exercise of its powers.[1]”

Introduction

The territorial application of laws made by Parliament is enshrined in Article 245 of the Constitution of India (“Constitution”). The universal presumption that laws made by a country are limited to its own territorial borders, is provided under Article 245(1) of the Constitution, which provides that “Subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India.” However, Article 245(2) of the Constitution carves out a specific exception providing that a law made by Parliament, pursuant to Article 245(1), shall not be invalidated on the ground that such a law would have extra-territorial operation. Most countries have enacted extra-territorial laws with the US being the clear leader in this regard having enacted anti-corruption law, securities laws etc. which have extra-territorial application.Continue Reading Extra-territorial application of India’s securities law – Has SEBI cast its net too wide?

WHAT IS FRONT RUNNING – A Q&A PIECE IN LIGHT OF THE SEBI ORDER AGAINST DEALERS OF RELIANCE SECURITIES LTD

Introduction

In an interim ex-parte order last month against the dealers of Reliance Securities Limited (“RSL”) and other related entities (“RSL Order”)[1], SEBI prima facie held over two dozen entities to have engaged in front running the trades of Tata Absolute Return Fund, a scheme of Tata AIF (“Big Client”).

During its preliminary examination, SEBI meticulously pieced together several bits of available circumstantial evidence and alleged an archetypal scheme of front running purportedly employed by three senior dealers (“Dealers”) at RSL, in nexus with various related entities. The RSL Order alleges that once the Dealers at RSL were privy to the non-public information of the impending orders of Big Client, they along with their connected broker or dealer entity would, through multiple trading accounts directly or indirectly controlled by them, place trades either in the Buy-Buy-Sell pattern or Sell-Sell-Buy pattern, around the time of the orders of the Big Client to generate substantial proceeds.
Continue Reading What is Front Running? – A Q&A Piece in Light of the SEBI Order Against Dealers of Reliance Securities Ltd.