Sharing of Unpublished Price Sensitive Information with Promoters

[Shikha Rawal is an Associate at a law firm in Mumbai. The views in this post are personal.] In June this year, the Securities and Exchange Board of India (“SEBI”) constituted a committee under the Chairmanship of Mr. Uday Kotak (“Kotak Committee”) to propose reforms to regulations governing listed companies. After careful deliberations, the Kotak Committee submitted a report on October 5, 2017 (“Report”). The purpose of the Report is to enhance the standards of corporate governance of listed companies in India. The present critique of the Report is based on the issue relating to the sharing of unpublished price sensitive information (“UPSI”) with promoters/ controlling shareholders and the effect thereof. Amendments have been proposed to the following regulations: (a) Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”) by way of insertion of a…

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