Guidelines on Information and Cyber Security extended to Insurance Intermediary
– Kaushal Shah, Executive | kaushal@vinodkothari.com
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Open in new tab IRDA relaxes stringent norms for Common Directors among insurance intermediaries
– Kaushal Shah, Executive | kaushal@vinodkothari.com
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Our related write-up:
IRDA rolls out conditions for common directorship in insurance company and intermediary – https://vinodkothari.com/2022/09/irda-rolls-out-conditions-for-common-directorship-in-insurance-company-and-intermediary/
Write ups on Corporate Laws – https://vinodkothari.com/category/corporate-laws/
The essence of mens rea in insider trading
Supreme Court contradicts its previous ruling while considering the ‘intent’ in insider trading
– CS Aisha Begum Ansari | aisha@vinodkothari.com
Insider trading means dealing in the securities of the listed company on the basis of unpublished price sensitive information (‘UPSI’), thereby gaining an unfair advantage over the market. A person guilty of insider trading is punishable with a monetary penalty[1] under section 15G of the SEBI Act, 1992 (the ‘Act’). Further, under section 24 of the Act, SEBI can punish a person with imprisonment of upto Rs. 10 years or with a fine of upto Rs. 35 crores or both for violation of the Act and its regulations.
Read more →Workshop on RPT compliance by Subsidiaries of Listed Entities
Expanding the ambit of IT Act in a bid for increased digitalisation
– Neha Sinha, Assistant Legal Advisor | finserv@vinodkothari.com
Introduction
The Information Technology Act, 2000 (‘IT Act’) allows digital execution of documents by way of electronic and digital signatures. While the reach of IT Act is wide, certain contracts and transactions were excluded from its ambit. The First Schedule of IT Act enumerates the documents or transactions to which IT Act is not applicable and such documents or transactions cannot be signed digitally. Recently, the Ministry of Electronics and Information Technology has released a notification amending the First Schedule of the IT Act. The amendments are as follows:
- Entry No. 5 of the said Schedule included “any contract for sale or conveyance of immovable property or any interest in such property”. Contracts for sale of immovable property fell outside the scope of the IT Act and hence, could not be signed digitally. The Amendment has omitted the Entry No. 5, thus, bringing contracts for sale or conveyance of immovable property within the ambit of the IT Act. This amendment allows a contract for sale of immovable property to be executed digitally.
- Entry No. 2 of the said Schedule contained power-of-attorney, thus, excluding it from the purview of the IT Act. The amendment allows the application of the IT Act to those power-of-attorney that empower an entity regulated by the RBI, National Housing Bank, SEBI, IRDAI and PFRDA to act for the person executing it. Hence, a power-of-attorney in favour of entities regulated by these bodies can now be executed digitally.
- Entry No. 1 of the said Schedule, excluded the application of the IT Act to negotiable instruments other than a cheque. Hence, negotiable instruments could not be signed digitally, but cheques were exempt from this provision and they could be signed digitally. The amendment has included other negotiable instruments and brought them within the purview of the IT Act. Now, a cheque, a demand promissory note or a bill of exchange issued in favour of or endorsed by an entity regulated by the Reserve Bank of India, National Housing Bank, Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India and Pension Fund Regulatory and Development Authority, can be signed digitally.
SEBI rationalizes issuances on Electronic Book Platform – Limits | Bidding Process | Anchor Investor | Basis of Allotment
– Kaushal Shah, Executive & Lovish Jain, Executive | corplaw@vinodkothari.com
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Also read our articles on the topic here
SEBI approves amendments: Alternate thresholds for ID Appointment | Online bond trading platform | Scheme of arrangement of NCS-listed entities | Trading in MF units
– Team Corplaw | corplaw@vinodkothari.com
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Related write-ups:
- SEBI proposes to regulate private debt platforms – https://vinodkothari.com/2022/07/sebi-proposes-to-regulate-private-debt-platforms/
- SEBI: Insider trading norms should apply to fund managers – https://vinodkothari.com/2022/07/sebi-proposes-to-extend-applicability-of-insider-trading-regulations-to-units-of-mutual-funds/
FAQs on half-yearly disclosure of RPTs to the stock exchanges
– Team Corplaw | corplaw@vinodkothari.com
Background
SEBI, vide its notification dated November 09, 2021 amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’) carrying out radical changes in the regulatory framework for the Related Party Transactions (‘RPTs’), including but not limited to the definition of Related Party (‘RP’), RPTs, its approval mechanism and disclosure requirements to the stock exchange. The amended provisions have been effective from April 01, 2022, except for the few provisions which will be applicable w.e.f. April 01, 2023. Information to be placed before the Audit Committee and shareholders (in case of material RPT) and the format of disclosure of RPTs to be filed with the Stock Exchanges (‘SEs’) has been separately prescribed vide SEBI Circular dated November 22, 2021. The circular was also made applicable to High Value Debt Listed Entities (‘HVDLEs’)[1] vide SEBI Circular dated January 7, 2022.
Read more →FAQs on preferential issue of equity shares and convertible securities under SEBI ICDR
Anushka Vohra, Manager | corplaw@vinodkothari.com
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Maintenance of security cover for secured debt made transparent by SEBI
Debenture trustees responsible for monitoring the security cover and covenants effective October 1, 2022
– Vinita Nair, Senior Partner | corplaw@vinodkothari.com
Background
Securities and Exchange Board of India (‘SEBI’) is carrying out radical changes in relation to monitoring the security cover and covenants with respect to listed debt securities. Recently, SEBI amended SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’) and SEBI (Debenture Trustees) Regulations, 1993 (‘DT Regulations’) and SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (‘NCS Regulations’) in order to substitute the concept of ‘asset cover’ with ‘security cover’ and accordingly, prescribed the requirement of maintenance and reporting of the security cover in case of listed secured debentures[1].
Monitoring of security cover has always been the key responsibility of the DT and therefore, SEBI in November 2020, had prescribed norms for independent due diligence by DTs for the purpose of creation of security[2] and for periodical monitoring of the security created and enhanced disclosures by DTs[3]. Thereafter, in August, 2021[4] SEBI rolled out the norms for security and covenant monitoring using Distributed Ledger Technology (‘DLT’) and in March, 2022 prescribed operational guidelines for security and covenant monitoring wherein system generated unique identifier (Asset ID) will be generated for each security offered by issuer in order to enable the DTs and Credit Rating Agencies (‘CRAs’) for better tracking[5]. Lastly, on August 4, 2022[6] SEBI issued enhanced guidelines for DTs and listed issuer companies on security creation and initial due diligence which inter-alia provides directions to harmonize the process of creation of security.
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