[Gayatri Puthran is a 3rd Year B.B.A., LL.B. student at the Jindal Global Law School] In a bid to promote ease of doing business, the Securities and Exchange Board of India (‘SEBI’) on 2 September 2020 by way of its circular titled ‘Disclosures on Margin obligations given by way of Pledge/ Re-Pledge in the Depository System’ (‘Disclosure Circular’) dispensed with certain disclosure...
Litigation against Credit Rating Agencies: Delhi High Court Delineates the Scope
[Kajal Singh and Nikunj Maheshwari are 4th year law students at the Institute of Law, Nirma University, Ahmedabad.] Credit rating is a mechanism to address the asymmetry of information in the debt investment market, where the independent credit rating agencies (‘CRA’) rate the debt instruments issued by the borrower company (‘client’). Clients, to get their instruments rated, enter into an...
Banning Short-Selling During Financial Crises – An Optimal Approach?
[Talin Bhardwaj is a third-year student of B.A. LL.B (Hons.) at the Rajiv Gandhi National University of Law, Patiala] The unprecedented circumstances emanating from the Covid-19 pandemic have created major instability in the financial markets of various countries that has been detrimental to the confidence of investors. This economic crisis has forced financial regulators around the world to take...
Disgorgement in India: Takeaways from a Recent US Supreme Court Ruling
[Shaivi Shah is a 3rd year student and Palash Moolchandani a 4th year student, both at National Law University, Odisha] The Black’s Law Dictionary defines disgorgement as “the act of giving up something (such as profits illegally obtained) on demand or by legal compulsion”. In India, since the enactment of the Securities and Exchange Board of India Act, 1992, the tool of disgorgement has been...
Dave Committee on Strengthening SEBI’s Recovery Mechanism: Missed Opportunities
[Rohan Deshpande practices as a Counsel at the Bombay High Court] On December 14, 2017, the Securities and Exchange Board of India (SEBI) formed a High Level Committee chaired by Justice Anil R. Dave, a former judge of the Supreme Court. One of the terms of reference of the Committee was to review the enforcement mechanism of SEBI, particularly the recovery mechanism under securities laws. The...
Foray into Global Capital Markets: Is India Inc. Ready for It?
[Eshvar Girish is a 5th year BBA LLB student at Christ University] Recently, the Union Cabinet approved a proposal to allow the listing of Indian companies overseas directly, without being listed on the domestic stock exchanges. India Inc. has perceived this approval as a much-needed move. Keeping this in mind, this post aims to analyze the implications of direct listing of Indian companies...
Relief Defendants in Recovery Proceedings: Implications of the Dave Committee’s Suggestion
[Pranav Mihir Kandada and Anuraag Bukkapatnam are 3rd year law students at NALSAR University of Law, Hyderabad] On June 16, 2020, SEBI notified the report of the High Level Committee under the chairmanship of Justice (Retd.) Anil R. Dave on the “Measures for Strengthening the Enforcement Mechanism of the Board and Incidental Issues”. The Committee examined the present securities laws and noted...
Investment Adviser Regulations: Settling the Dust between Advisory and Distribution Services
[Aditya Bhayal and Prachi Tripathi are 4th Year, B.A.LLB (Hons.) students at NALSAR University of Law, Hyderabad] In February 2020, the Securities and Exchange Board of India (“SEBI”) approved proposals on some regulatory changes to the SEBI (Investment Advisers) Regulations, 2013 (the “Regulations”). These changes come in the backdrop of four consultation papers which were released in 2016...
Demystifying the Interface between Securities Law and the IBC
[Hitoishi Sarkar and Yash More are II year students at Gujarat National Law University, Gandhinagar] On June 16, 2020, a high-level committee constituted by the Securities and Exchange Board of India (“SEBI”) under the chairmanship of Justice Anil R. Dave released its report titled Measures for Strengthening the Enforcement Mechanism of the Board and Incidental Issues (“SEBI...
Orders in the WhatsApp Leak Case: Technological Constraints and UPSI
[Pranav Mihir Kandada is a rising 3rd year student at NALSAR University of Law, Hyderabad] Ever since the first case of insider trading through online messaging about two decades ago, insider trading in the digital era has gained new contours over the years. In India, the advent of instant messaging services with end-to-end encryption has turned them into a new venue for communication of...
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