New insider trading regulations in the country
came into force on May 15. Their stricter approach will boost
market integrity, but may have an adverse effect on
The new rules are part of the Securities and
Exchange Board of India’s (Sebi) attempt to fix
what IFLR sources have described as one of the leakiest markets
They make several changes, including broadening the
scope of insiders and connected partners, as well as what
constitutes unpublished price sensitive information (UPSI).
Now, merely communicating UPSI – even without trading
on it – is a violation of the regulations.
These rules may have a decidedly mixed effect on
M&A deals, for which sellers must give buyers UPSI so that
they can complete due diligence. It could limit future private
investment in public equity (Pipe) deals and secondary
India’s new insider