Sebi eases trading norm for companies’ insiders

New Delhi, June 26

Capital markets regulator Sebi today eased ‘trading plans’ framework for companies’ insiders, who are perpetually in possession of unpublished price sensitive information. Under the rule, ‘Trading Plans’ (TP) enable persons like senior management or Key Managerial Personnel, who are perpetually in possession of Unpublished Price Sensitive Information, to trade in securities in a compliant manner.

In a notification, Sebi said that a minimum cool-off period between disclosure and implementation of trading plan has been reduced to four months from six months earlier. It means trading plans can be executed only after 6 months from its public disclosure.

The regulator said the insider will have flexibility, during formulation of TP, to provide price limits — upper price limits for buy trades and lower price limits for sell trades. Such price limit will be within +/-20 per cent of the closing price on date of submission of TP.