One of our pet peeves has been the considerable disparity in the primary market disclosure norms where SEBI requires extensive disclosures when a company undertakes a public offering and in the secondary market disclosures norms where companies have to make continuous disclosures post-listing. The secondary market disclosure norms are considerably weaker than those for the primary markets...
“Make in India” frustrated by regulations “Made in India”
The Delisting Regulations applicable in India have been controversial since inception. Earlier this year, SEBI published a discussion paper seeking to review them. This Blog commented on the discussion paper here. Earlier this week, in my column in Business Standard, I wrote about how tinkering with the Delisting Regulations will not be of help. The Delisting Regulations is a body of...
Guest Post: Critical Analysis of Securities Laws (Amendments) Bill, 2014
[The author is a practicing lawyer in Mumbai. Email: [email protected]] This post is on a slew of legislative changes in Securities Laws through three ordinances and more particularly, Securities Laws (Amendment) Ordinance, 2014 (“2014 Ordinance”) which has been passed by the Lok Sabha as Securities Laws (Amendment) Bill, 2014 (“2014 Bill”). Three ordinances were...
Consequences of Inaccurate Shareholding Disclosures
Both the SEBI (Substantial Acquisition of Shares and Takeovers Regulations), 2011 (the Takeover Regulations) as well as the SEBI (Prohibition of Insider Trading) Regulations, 1992 (the PIT Regulations) require a timely disclosure of acquisition or change in shareholdings beyond certain thresholds by substantial shareholders and promoters. Such disclosure requirements are also captured in clause...
Guest Post: Comments on SEBI’s Crowdfunding Paper
[The following post is contributed by Debanshu Mukherjee, a Senior Resident Fellow at Vidhi Centre for Legal Policy, New Delhi] Last month, SEBI had issued a Consultation Paper on regulating Crowdfunding in India. Vidhi Centre for Legal Policy, a New Delhi based independent and not-for-profit think-tank prepared a detailed response to the Paper and submitted it to SEBI earlier this month...
SEBI: Infrastructure Investments and Portfolio Investments
Infrastructure Investment Trusts Last last year, we had discussed the SEBI Consultation Paper on Infrastructure Investment Trusts. While the move towards the establishment of infrastucture investment trusts (InvITs) was welcome, certain issues such as tax treatment remained to be ironed out. Now that the tax treatment has been addressed in the Budget 2014, SEBI has published a draft of the SEBI...
SEBI Order in the Satyam Case
Facts and Sanctions Yesterday, more than five years after the Satyam ex-chairman’s much talked about revelations, SEBI passed an order in the case against five individuals, being the ex-chairman, ex-managing director, ex-Chief Financial Officer, ex-Vice President Finance and ex-Head (Internal Audit). In the 65-page order, SEBI considers the various acts of these individuals in detail that include...
SEBI Order on Delisting
A few weeks ago, we discussed SEBI’s proposals to overhaul the delisting regime. Evident from that discussion were difficulties faced in the current delisting regime. Some of those difficulties have surfaced in an order issued by SEBI yesterday involving the delisting of AstraZeneca Pharma India Limited. SEBI’s order alleges a concerted action between the controlling shareholder of the target and...
US Supreme Court Decision on Securities Fraud Actions
The US Supreme Court yesterday issued its opinion in a significant case that determines the state of the law on class actions for securities fraud. The background and the issue in question have been set out in the ruling as follows: Investors can recover damages in a private securities fraud action only if they prove that they relied on the defendant’s misrepresentation in deciding to buy or sell...
SEBI Consultation Paper on Crowdfunding
We have previously discussed the concept of crowdfunding and the broad nature of the legal issues that it might give rise to. Essentially, crowdfunding that involves the issue of securities (equity or debt) would attract the provisions of company law as well as securities laws. While specific crowdfunding legislation has been introduced in several countries (e.g. JOBS Act in the US), there has...
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