[The following guest post is contributed by Arundhuthi Bose, who is an Executive at Vinod Kothari & Co.] Introduction Issuing bonds to raise funds from investors is not a novel concept. A bond, in common parlance, is an instrument evidencing indebtedness of the bond issuer to the bondholders. Here, a debt instrument is issued by the issuer to the investor, under which the issuer...
Differentiated Banks – Leading the March Towards Financial Inclusion
[The following guest post is contributed by Neelasha Nemani, who is a 4th year B.A. LL.B. (Hons.) student from National Law University Odisha, Cuttack.] India’s impetus on financial inclusion is now stronger than ever. Recently, the Reserve Bank of India (RBI) granted an in principle approval to 11 entities to set up Payments Banks[1] and 10 entities to set up Small Finance Banks[2] as an...
Presumption in Insider Trading
Given the evidentiary problems in insider trading cases, SEBI has resorted to the use of presumptions in its enforcement of the SEBI (Prohibition of Insider Trading) Regulations, 1992. Some of the issues that arose due to this approach have been discussed in the past. These issues have resurfaced more recently in a short order of the Securities Appellate Tribunal (SAT) in the case of Reliance...
Competition Law: Analysis of the COMPAT Order in Surendra Prasad v. CCI
[The following guest post is contributed by Sarthak Raizada and Kartikey Kulshreshtha, who are 4th year students at Dr. Ram Manohar Lohiya National Law University, Lucknow.] Introduction The Competition Act, 2002 (the “Act”), while still in the early stages of its development in India, has witnessed immense litigation. The Competition Commission of India (“CCI”) has adjudicated and delivered...
Contract Depriving a Party of Interest: Immorality and Public Policy
[The following guest post is contributed by Amitav Singh, a fourth-year student at the National University of Advanced Legal Studies (NUALS), Kochi] In a recent decision in Union of India v. M/s NK Garg & Co. (“NK Garg”), decided on 2 November, 2015, a single judge of the Delhi High Court (“Court”) held that any agreement by which a party is deprived of interest would be void on the ground...
Whether Collection of Margin on Derivative Trades is Mandatory?
[This post is contributed by Prachi Pandya, founding proprietress of Corporate Attorneys and Vanessa Fernandes, an intern at Corporate Attorneys] Despite being termed as a weapon of mass destruction by Warren Buffet, derivatives are still an integral part of stock market trading. Whilst purchasing equity, one has to pay the entire value of the shares purchased within the settlement period of two...
Problems with the RBI’s new ECB framework
[This guest post is by Pratik Datta and Shefali Malhotra, who are Consultants at the National Institute of Public Finance and Policy (NIPFP). They can be reached at [email protected] and [email protected] respectively.] Introduction This blog had earlier explained the policy backdrop leading up to the Reserve Bank of India’s (RBI’s) draft framework for External...
Papers on Takeover Regulation
I have posted two papers on SSRN, the titles and abstracts of which are as follows: 1. “Comparative Takeover Regulation and the Concept of ‘Control’” The mandatory bid rule (MBR), one of the basic tenets of takeover regulation, obligates an acquirer who obtains ‘control’ over a target company to make an offer to acquire the shares of the...
Supreme Court on Takeover Offer Price
Under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations (both under the current version of 2011 and previous version of 1997), takeover offers are required to be made at a minimum offer price that is based on the historical market price over a specified period of time and also on other acquisitions made by the acquirer of persons acting in concert (PACs) during a similar...
Voting Rights on Preference Shares: An Unclear Provision?
[The following guest post is contributed by Vignesh Iyer of Vinod Kothari & Co. The author can be contacted at [email protected]] The enactment of the Companies Act, 2013 (Act, 2013) has given rise to various issues with regard to compliance and interpretations of several statutory provisions. One such issue is the subject matter of this post. Section 47 of Act, 2013 – Voting...
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