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TMI BlogTrading PlansX X X X Extracts X X X X X X X X Extracts X X X X ..... rom the public disclosure of the plan; NOTE: It is intended that to get the benefit of a trading plan, a cool-off period of 3 [ one hundred and twenty calendar days ] is necessary. 4 [ Companies declare their results quarterly and there exists a trading restriction, in terms of these Regulations, from quarter end to two days after declaration of quarterly result, which, it is seen, is generally a period of around one month for most companies. Thus, one hundred and twenty calendar days ] period is considered reasonably long for unpublished price sensitive information that is in possession of the insider when formulating the trading plan, to become generally available. It is also considered to be a reasonable period for a time lag in which new unpublished price sensitive information may come into being without adversely affecting the trading plan formulated earlier. In any case, it should be remembered that this is only a statutory cool-off period and would not grant immunity from action if the insider were to be in possession of the same unpublished price sensitive information both at the time of formulation of the plan and implementation of the same. (ii) 5 [ **** ] (iii) 6 [ **** ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e set out in the plan. 9 [ However, there should be an outer limit on the duration of the time period, so that while it allows the insider to split their trades across different dates, duration should not be so long that it is prone to misuse. Further, to protect the insider from unexpected price movements, he may, at the time of formulation of trading plan, provide price limits within the range specified in these Regulations. ] (vi) not entail trading in securities for market abuse. NOTE: Trading on the basis of such a trading plan would not grant absolute immunity from bringing proceedings for market abuse. For instance, in the event of manipulative timing of the release of unpublished price sensitive information to ensure that trading under a trading plan becomes lucrative in circumvention of regulation 4 being detected, it would be open to initiate proceedings for alleged breach of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to the Securities Market) Regulations, 2003. (3) The compliance officer shall review the trading plan to assess whether the plan would have any potential for violation of these regulations and shall be entitled to seek such express u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... place such information along with his recommendation to accept or reject the submissions of the insider, before the Audit Committee in the immediate next meeting. The Audit Committee shall decide whether such non-implementation (full/partial) was bona fide or not. (iii) The decision of the Audit Committee shall be notified by the compliance officer on the same day to the stock exchanges on which the securities are listed. (iv) In case the Audit Committee does not accept the submissions made by the insider, then the compliance officer shall take action as per the Code of Conduct. ] NOTE: It is intended that since the trading plan is an exception to the general rule that an insider should not trade when in possession of unpublished price sensitive information, changing the plan or trading outside the same would negate the intent behind the exception. Other investors in the market, too, would factor the impact of the trading plan on their own trading decisions and in price discovery. Therefore, it is not fair or desirable to permit the insider to deviate from the trading plan based on which others in the market have assessed their views on the securities 15 [ except in situations bey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce on the ninetieth day from the date of their publication in the Official Gazette) before it was read as, Such a 5. Omitted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) before it was read as, (ii) not entail trading for the period between the twentieth trading day prior to the last day of any financial period for which results are required to be announced by the issuer of the securities and the second trading day after the disclosure of such financial results; NOTE: Since the trading plan is envisaged to be an exception to the general rule prohibiting trading by insiders when in possession of unpublished price sensitive information, it is important that the trading plan does not entail trading for a reasonable period around the declaration of financial results as that would generate unpublished price sensitive information. 6. Omitted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) before it was read as, (iii) entail trading for a period of n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gazette) 15. Inserted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) 16. Inserted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) 17. Substituted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) before it was read as, six-month 18. Substituted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) before it was read as, commencement of execution of the trading plan ought to be deferred 19. Inserted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publication in the Official Gazette) 20. Substituted vide Notification No. SEBI/LAD-NRO/GN/2024/184 dated 25-06-2024 (shall come into force on the ninetieth day from the date of their publicati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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