AuthorCA Jayant Thakur

The Economic Times reports today (17th January 2009) that SEBI is examining whether, in law, pledge of shares amounts to Insider Trading. The SEBI Committee, as the report importantly adds, will also consider whether the law should be amended whereby pledge of Promoters’ shares would now be required to be disclosed. A crisis and major scandal such as Satyam often has the good effect of speeding...

This series was proposed by the first post to take the Satyam Episode as a case study to understand what laws apply and whether and how are they appropriate to punish wrong doings. For this purpose, let us consider what are the alleged wrongs? To start with, let us shortlist some of these wrongs and then see which of them are punishable and/or capable of being compensated by law. So, without...

Some quick thoughts and updates from my side, based on published data. Later, I propose to list a few of the legal provisions that would need to be examined. The idea is to see what the present law provides for dealing with the allegations in the alleged “Satyam Fraud”. 1. The Justice Kania Committee chaired by ex-Chief Justice of India, Mr. Justice M. H. Kania, opined as early as 2005 that...

Ramalinga Raju, Chairman, of Satyam Computers is reported to have “admitted fraud” of Rs. 5040 crores (see amongst numerous other reports, this report). Without intending to overstate, I think, for India, this episode may be bigger than what Enron was for US. So many fundamental questions are likely to arise that the preliminary and obvious issues of corporate governance and role of...

Poor drafting of the recent amendments to the SEBI Insider Trading Regulations has made the bar on six month reverse trading/ derivatives substantively ineffective. The SEBI Insider Trading Regulations were amended vide notification dated 19th November 2008 available here and some issues relating to these amendments were discussed by me here. The Model Code relating to procedures, etc. to prevent...

SEBI has amended the SEBI Prohibition of Insider Trading Regulations vide notification dated 19th November 2008, available here. While I will post here later in more detail some issues relating to the amendments, let me highlight a couple of points. The definition of “insider” has been amended. Interestingly, there is magic involved here! Not one word has been added or deleted. But the meaning of...

Gail, ONGC, Indian Oil Corporation, etc. have, as per Orders of Adjudicating Officer (see, e.g., Indian Oil order here and others available on SEBI site) allegedly violated Clause 49 of the Listing Agreement since they allegedly delayed the appointment of Independent Directors. These orders are perhaps of the earliest of orders of adjudication of violation of requirements in relation to Corporate...

Further to posts here regarding amendment to SEBI Takeover Regulations allowing persons holding 55-75% to acquire further 5%, see report in ET dated 5th November 2008 that says that this permission may soon be reversed. Readers may recollect that this new amendment allowing such 5% increase was without any time limit and also not a recurring annual feature. Apparently it was to allow Promoters to...

SAT has recently decided here on the issue on whether, when and at what price would an open offer have to be made when Share Warrants are exercised. I am highlighting here just some interesting facts and decisions, simplifying them a little, to emphasize some interesting issues. The Promoter of the target company, Genesis International Corporation Limited, was issued 3530000 Share Warrants...