INDIA: SEBI amends India Insider Trading rules for India major shareholdings

Wednesday September 7 2011

The Securities and Exchange Board of India has amended the SEBI (Prohibition of Insider Trading) Regulations for India major shareholdings, which require disclosure by shareholders on reaching a 5% threshold in a listed company, and any changes of 2%. The rules introduce a new reporting requirement for promoters and promoter groups in listed companies.

Under the newly-inserted Regulation 13(2A), any person who is a promoter or part of a promoter group of a listed company shall disclose to the company the number of shares or voting rights held by such person, within two working days of becoming such promoter or person belonging to a promoter group. In addition, a new Regulation 13(4A) was inserted, which requires any person who is a promoter or part of promoter group of a listed company to disclose to the company and the stock exchange where the securities are listed the total number of shares or voting rights held and change in shareholding or voting rights, if there has been a change in such holdings of such person from the last disclosure made under the Listing Agreement or under sub-regulation (2A) or under this sub-regulation, and the change exceeds Rs. 5 lakh in value or 25,000 shares or 1% of total shareholding or voting rights, whichever is lower.

Standard forms for reporting are appended to the Amendment Regulations.