Sebi disallows badla variants from
July 2
Mumbai: The Sebi board has decided to ban all deferral products
from July 2 this year.
However, it has allowed time till September 3 to liquidate outstanding deferred positions
as of the current settlement, worth close to Rs 2,000 crore. No new deferred positions
will be allowed from July 2.
While 414 scrips accounting for 95 per cent of trading volumes will be brought within the
ambit of rolling settlements from July 2 onwards, all remaining scrips will be moved to a
rolling mode from January 2, 2002.
The markets regulator seeks to crack down on inter-exchange arbitrage and has declared
that from July 2, there will be a uniform Monday-to-Friday settlement cycle across all
bourses for all scrips not in the rolling mode.
In addition to this price bands will be removed for all stocks in rolling mode and the
global practice of having index-based circuit filters is also being introduced.
The Sebi board also paves the way for launch of options trading on individual stocks,
while it has deferred the launch of futures on individual stocks. It has approved a code
of conduct and a preventive framework against insider trading.
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Directors,
co directors to disclose transactions exceeding 5000 shares
Mumbai: In another tightening move Sebi says that directors and other
officers of companies who may be termed as 'insiders' will now have to continuously
disclose to the market any sale or purchase by them of more than 5,000 shares or Rs 5 lakh
worth of shares (whichever is lower) of the company they work for, within four days of the
transaction.
This paves the way for the creation of a code of conduct to prevent insider trading as
also for corporate disclosure practices for listed companies.
Shareholders with more than 5 per cent holding would also have to disclose their holding
initially and make continuous disclosure for every 2 per cent change in shareholding.
Analysts, too, will no longer be privy to price sensitive information, as any such
information passed on to them would have to be disclosed to the entire market.
Says LK Singhvi, Sebis senior executive director, the person largely responsible for
drafting the code, "the disclosure would be first made to the company concerned
within four days and then the company would disclose the same to the stock exchange."
The implementation of the code will be
mandatory for listed companies and all categories of market intermediaries -- including
stock exchanges, brokers, merchant bankers, mutual funds, depositories, financial
institutions and professional firms, such as auditors, accountancy and legal firms.
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