Capital market regulator SEBI will implement insider trading rules from November 1 with the aim of increasing transparency in asset management companies. A notification has been issued for this. Anand Rathi Wealth Ltd. Deputy CEO Firoz Aziz said that SEBI has made it mandatory for employees having access to unpublished price-related sensitive information to be identified as designated persons. Through this, SEBI is making the system tight regarding insider trading.
The board of directors approved it
According to the news, he said that the emphasis on maintaining the confidentiality of sensitive information and imposing adequate restrictions on taking advantage of it reflects SEBI’s commitment to prevent insider trading. According to a notification of SEBI dated July 26, the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2022, will come into force from November 1, 2024. The Board of Directors has approved it.
Aziz said the revised rules require maintaining a list of employees and other individuals who have access to unpublished information, and also require signing confidentiality agreements or giving notices. This further tightens security. Industry experts say the implementation of the law was delayed mainly due to industry resistance and operational challenges in setting common standards.
What the rule says
According to the rule, AMCs are required to disclose on the platform of stock exchanges, details of holdings in units of their mutual fund schemes by the AMC, trustees and their close relatives, on a consolidated basis. Details of all transactions in units of their own mutual funds executed by nominees, trustees and their close relatives of the asset management company (AMC) shall be reported by the concerned person to the compliance officer of the asset management.
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