LEVERAGING TECHNOLOGY FOR CONTINUAL DISCLOSURE UNDER PIT REGULATIONS, 2015 BY SEBI – Eshwars
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LEVERAGING TECHNOLOGY FOR CONTINUAL DISCLOSURE UNDER PIT REGULATIONS, 2015 BY SEBI

Authored by Lakshmi Rengarajan

Promoters, directors and designated employees (“Identified Persons”) of a Listed Company (“Company”) are [under SEBI (Prohibition of Insider Trading) Regulations, 2015,] required to disclose (to the Company) their trading in the Company’s share, if the aggregate traded value exceeds Rs. 10 Lakhs in a calendar quarter (“Transaction”), within two days of such Transaction. The Company in turn is required to intimate within two days of receipt of details of such Transaction to the stock exchanges where the securities are listed

With trading being carried out only in Demat mode, the information of such trading is an information that is available with the depositories and having automated, the disclosure under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, SEBI is now extending it to the PIT Regulations too.

Vide circular SEBI/HO/ISD/ISD/CIR/P/2020/168 dated 9th September 2020, SEBI has brought in a system driven process to identify and publish the Transaction executed by Identified Persons of Listed Company in its website.

The provisions of this circular is applicable to Transaction by the Identified Persons, both in equity shares of the Company and in the F&O Segment.

Companies are required to provide the PAN/ investor’s demat account number of the Identified Persons to depositories to track the Transaction made by them in the Company in all the exchanges and publish details of such Transaction in its website. The said dissemination will be made by the stock exchanges on T+2 day basis.

Transition

The stock exchange shall commence the publishing of the details of Transaction made by the Persons on and from 01st October 2020.

The obligation of the Identified Persons to make disclosure to the Company continues, so does the obligation of the Companies to disclose to the stock exchanges the disclosure made by the Identified Persons in the existing prescribed formats till 31st March 2021.

 One need to wait to see if SEBI does away with the requirement of dual disclosure after 31st March 2021.

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