[Anshita Dave and Abhyudaya Yadav are 5th year B.A., LL.B. (Hons.) students at Dharmashastra National Law University, Jabalpur] Recently, the Supreme Court in IFB Agro Industries Limited v. SICGIL India Limited held that the National Company Law Tribunal (“NCLT”) cannot exercise its rectificatory jurisdiction under section 59 of the Companies Act, 2013 (“the Act”) to...
Mutual Funds, Insider Trading and the Myth of Sisyphus
[Shruti Rajan is a partner at Trilegal] In Greek mythology, the gods condemned Sisyphus to an endless cycle of rolling a boulder up a hill, have it roll down and then start again. A parable of the interminable, eternal human struggle against the diktat of the gods, the fate of Sisyphus has long served as a metaphor for the repetitive and dogged demands of modern life and business. Introducing a...
Designing a Framework for Disclosures of “Market Rumors” under the LODR Regulations
[Harsh N Dudhe is a IV year student at NALSAR University of Law, Hyderabad] Much has already been said (here and here) about the pitfalls of the mandate proposed by the Securities and Exchange Board of India (SEBI) on top 250 listed companies to confirm or deny market rumors, as part of the continuous disclosure mechanism. The major criticism is that such disclosures would premature and may...
SEBI’s Proposed Disclosure Regime: Impact on Public M&A and Directors’ Liabilities
[Shivam Yadav, Amudavalli Kannan, and Shreyas Bhushan are with Resolut Partners] Institutional investors, listed companies, and retail shareholders – three key market participants – will be watching SEBI with eagle-eyes while it attempts to implement a new disclosure regime, as set out in its recent consultation paper (Consultation Paper). Most of SEBI’s proposals are well-intentioned and...
Strengthening SEBI’s Investor Grievance Redressal Mechanism: Recent Efforts
[Tarun Toprani is an associate and Sumit Agrawal a partner at Regstreet Law Advisors. The authors can be reached at [email protected]] The preamble of the Securities and Exchange Board of India Act, 1992 (“SEBI Act”) begins by stating that it is “[a]n Act to provide for the establishment of a Board to protect the interests of investors in securities…”. In fact, Section 11 of the SEBI Act, which...
SEBI Proposals to Revamp the Continuing Disclosure Regime
A robust continuing disclosure regime is a sine qua non for maintaining efficient capital markets. Over the years, the Securities and Exchange Board of India (SEBI) has developed and enhanced a continuing disclosure regime for Indian listed companies, which is now encapsulated in regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the ‘LODR Regulations’)...
SAT on the Non-Liability of a Company Secretary for Incorrect Disclosures
On 1 November 2022, the Securities Appellate Tribunal (SAT) in V. Shankar v. Securities and Exchange Board of India exonerated the company secretary of Deccan Chronicle Holdings Limited (DCHL) from liability for certain misstatements and incorrect disclosures made by the company. Background and Decision The Securities and Exchange Board of India (SEBI) had conducted investigation for certain...
How Securities Laws are Enforced in India: Some Facts from a New Data-set of SEBI Orders
As the regulator of one of the world’s largest stock markets by market capitalization, the Securities and Exchange Board of India (SEBI) has several enforcement tools at its disposal. These include imposing monetary penalties, cancelling licences of regulated intermediaries and pursuing criminal proceedings against violators of the laws, regulations and rules administered by SEBI. Moreover, the...
GNLU Advanced Certificate Programme in Capital Markets & Securities Laws
[Announcement on behalf of the GNLU Centre for Business and Public Policy] Established in 2003 with an aim to become a Research-based Teaching university, Gujarat National Law University (GNLU), has always taken proactive initiatives and outlook to provide valuable and mutually beneficial services to the institution of governance, judiciary, economy and civil society, especially weaker sections...
Supreme Court on Motive as a Precondition for Insider Trading
In a significant decision in Securities and Exchange Board of India v. Abhijit Rajan (19 September 2022), the Supreme Court of India has ruled that the motive on the part of the insider to seek profits is an essential precondition for a successful insider trading charge. Such a directive from the Supreme Court is likely to have implications for insider trading cases currently within the...
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