CAIRR Update August 10, 2022

August 08, 2022

Summary of the circular issued by SEBI on 05/08/2022

SEBI issues Circular for Trading Window closure period under Clause 4 of Schedule B read with Regulation 9 of SEBI (Prohibition of Insider Trading) Regulations, 2015 (“PIT Regulations”) – Framework for restricting trading by Designated Persons (“DPs”) by freezing PAN at security level

In furtherance to the provisions of Clause 4 (1) of Schedule B read with Regulation 9 of PIT Regulations, regarding restriction of trading in securities of a Listed Company by Designated persons and their immediate relatives during trading window closure, SEBI vide its circular dated 05/08/2022 has decided to develop a system to improve ease of doing business and preventing inadvertent non-compliance of the provisions of PIT Regulations by DPs.

Key highlights of the circular are:

1. This circular shall be applicable to declaration of financial results of the listed company that is or was a part of NIFTY 50 and SENSEX from the date of implementation of this circular.
2. Restriction of trading shall be for on-market transactions, off market transfers and creation of pledge in equity shares and equity derivatives contracts (i.e., Futures and Options) of such listed companies.
3. Listed Company shall update/ confirm the PAN of DPs to be frozen and Commencement date and End date of Trading Window Closure.
4. Trading window closure ‘Commencement Date’ shall be the 1^st day (T-Day) immediately after the end of every quarter for which financial results are to be announced and ‘Trading Window Closure End date’ shall be 48 hours post disclosure of financial results.
5. Depositories and stock exchanges shall restrict trading of DP from T-day, till end of trading window closure period.
6. The details of DP and dates of Trading window closure shall be made available/ confirmed to the Designated Depository at least 2 trading days prior to the commencement of Trading Window Closure.
7. Any addition/deletion/updation pertaining to the details of DP shall be affected within 2 trading days of receipt of intimation from the listed company and the procedure specified in terms of SEBI Circular No. SEBI/HO/ISD/ISD/CIR/P/2020/168 dated September 09, 2020, shall be followed.
8. Procedure for implementation of the system is in Annexure – A to the Circular.
9. In case of any discrepancy, the issue shall be resolved by the Depositories, in coordination with Stock Exchanges and listed company.

 This circular shall come into force with effect from the quarter ending September 30, 2022.

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This circular is integrated in our free-to-use website ca2013.com