Volume 1 Issue 2

Volume 1 Issue 2

Insider Trading Efficacy of the Latest Amendment - A Critical Comparative Study with Special Reference to the Legislative Framework in the USA

By Sonu Choudhary,
Student , National Law University, Ranchi

Abstract

“Higher the risk, higher the profit”. Given the high amount of speculations surrounding Stock Market Trading, risks involved are higher when the group of stake-holder misappropriate the unpublished price sensitive information to reap more profit, leaving at bay, the larger interest of general public, which in corporate terms known as insider trading. Insider trading as a negative concept is not merely a loss to the general public but it also encompasses the entire financial market.

 This research paper firstly outlines the concept of insider trading and gives a glimpse of historical background of this concept practice in US and India. The second part of this paper gives an insight to the Indian perspective regarding the concept of insider trading with special reference to The Companies Act 2013, The Competition Act 2002 and SEBI Act 1992. It further gives an insight into various regulations implemented by the SEBI to prohibit insider trading since 1992 till present, adopting the intermittent market conditions.

It further demonstrates a comparative analysis of U.S.A Laws vis–a–vis Indian laws highlighting various protection being implemented to guard the rights of general public, encompassing the significance of the terms insider, material information and penalties By this comparative analysis, the author tries to compare the Indian Model to that Of the US Model by referring to various enactment as mentioned. It further focuses on the recent amendment brought in by SEBI as SEBI (PIT) Amendment Regulations 2020 and highlights its implications in the market. This research paper finally ends with an insight for adoption of best existing practices for sustained market stability.

Recommended Citations :

OSCOLA

Sonu Choudhary, ‘Insider Trading: Efficacy of the Latest Amendment – A Critical Comparative Study with Special Reference to the Legislative Framework in the USA’, [2021] 2 IJBLS

https://intbusinesslaw.com/insider-trading-efficacy-of-the-latest-amendment-a-critical-comparative-study-with-special-reference-to-the-legislative-framework-in-the-usa/

Bluebook 19th Ed.

Sonu Choudhary, Insider Trading: Efficacy of the Latest Amendment – A Critical Comparative Study with Special Reference to the Legislative Framework in the USA, 1 IJBLS 2, 68-85 (2021)