Mumbai: The Securities and Exchange Board of India (
Sebi) said on Thursday it has made amendments to the
insider trading prohibition rules.
The markets regulator said the amendments to the insider trading prohibition rules include maintaining a structured digital database containing nature of unpublished price sensitive information and the names of persons who have shared the information.
It will involve automation of process of filing disclosures to stock exchanges, restriction on trading window not to be made applicable for transactions as prescribed by Sebi, and also entails entities to file the non-compliances of Code of Conduct with the stock exchanges.
Sebi also temporary relaxed the rules on pricing of preferential issues in the wake of Covid-19 crisis for issues between July and December 31, or as the regulator may notify.
It decided to provide an additional option to the existing pricing methodology for preferential issuance. Under this option, in case of frequently traded shares, the price of the equity shares to be allotted pursuant to the preferential issue shall be not less than higher of the average of the weekly high and low of the volume weighted average price (VWAP) of the related shares during the twelve weeks preceding the relevant date, or such average of the weekly high and low of VWAP of shares during the two weeks preceding the relevant date.
Such specified securities allotted on preferential basis using the above pricing formula shall be locked-in for a period of three years, Sebi said in a release.
The existing pricing guideline for preferential issue for frequently traded shares shall also continue to remain in force, and the issuer may choose any one of the formulas.
Sebi also permitted acquisition through stock exchange settlement process through bulk or block deals during the open offer.
In case of indirect acquisitions where public announcement of an open offer has been made, the entire consideration payable under the open offer must be deposited 2 working days before the date of detailed public statement, and an escrow account will be in the form of cash or bank guarantee.
If there is a delay in making open offer due to the acquirer’s acts, a simple interest of 10 per cent will be paid to the shareholders who have tendered the shares in the open offer, Sebi added.
Sebi also approved some amendments to the settlement regulations. Promoters will now be included along with the principal officer for the purpose of calculation of the base amount.
In order to save time, instead of issuing settlement notice, Sebi will now include a paragraph in the show cause notice, informing the noticee about the option to file a settlement application.