NO MORE MANUAL DISCLOSURES UNDER SEBI (PIT) REGULATIONS, 2015? – Eshwars
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NO MORE MANUAL DISCLOSURES UNDER SEBI (PIT) REGULATIONS, 2015?

Authored by Aishwarya Lakshmi VM

Background:

In our earlier Blog, we had written about the introduction of System Driven Disclosures (“SDD”) by SEBI through its Circular dated 09th September 2020. As per the said Circular, once the listed company disseminates the PAN / Demat Account Number of:

1. the promoters,

2. members of the promoter group,

3. designated persons and

4. directors

(Hereinafter collectively ‘Identified Persons’) to the Depositories, the said Depositories will track the transaction made by the Identified Persons in all the exchanges where the company is listed and inform to the Stock Exchanges, who in turn will publish the details of the transactions in their respective websites on a T+2 basis. As per the said Circular the obligation of the Identified Persons and the Company to make a manual disclosure under Regulation 7(2) of the SEBI (Prohibition of Insider Trading) Regulations, 2015 would continue until 31st March 2021. Thus, there was a dual manner of disclosing the trades i.e., manual and SDD.

SDD stands extended:

As per the 09th September 2020 Circular, at Para 4, it was mentioned that SEBI was introducing the SDD for trading in

a) equity shares and

b) equity derivative instruments i.e., Futures and Options.

Meanwhile as per the Circular of SEBI dated 16th June 2021 (Circular Number SEBI/HO/ISD/ISD/CIR/P/2021/578), SEBI extended the application of SDD, with effect from 01st July 2021,  to trades by the Identified Persons in Listed Debt Securities as well.

SEBI scrapes off Manual Disclosures:

Keeping the “ease of doing business” in mind and after having obtained confirmation from the Stock Exchanges and the Depositories that they have implemented SDD in line with the 09th September 2020 Circular, SEBI relaxed the necessity of making manual disclosures through SEBI Circular dated 13th August 2021. As per Para 4 of the said Circular, SEBI has clarified that for listed companies who have complied with requirements of the circular dated 09th September 2020, the manual filing of disclosures as required under Regulation 7(2)(a) & (b) of  PIT Regulations is no longer mandatory.

Conclusion:

Though the Circular is a respite from making dual disclosures for trades executed in the Equity and F&O Segment, it has not given any reference to trades in the Debt Segment. This implies that the manual disclosure for the Debt Segment would continue until further regulatory updates regarding the same.

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