what is trading window in insider trading?

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Uma asked almost 3 years ago

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7 Answers
Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 narahari answered over 2 years ago

Pre-Clearance by Compliance Officer. Every director, officer or employee of the Company shall advise the Compliance Officer before he or she effects any transaction in the Company's securities. This shall be done by submitting a completed Trading Approval Form, attached as Exhibit A, to the Compliance Officer. The Compliance Officer shall advise such director, officer or employee whether the proposed transaction is permissible under this Insider Trading Policy by making the appropriate indication and countersigning the Trading Approval Form.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 veeru answered almost 3 years ago

Pre-Clearance by Compliance Officer. Every director, officer or employee of the Company shall advise the Compliance Officer before he or she effects any transaction in the Company's securities. This shall be done by submitting a completed Trading Approval Form, attached as Exhibit A, to the Compliance Officer. The Compliance Officer shall advise such director, officer or employee whether the proposed transaction is permissible under this Insider Trading Policy by making the appropriate indication and countersigning the Trading Approval Form. Trading Window Periods. Investment by the Company’s directors, officers or employees in Company securities is encouraged, so long as such persons do not purchase or sell such securities in violation of this Insider Trading Policy. In furtherance of the goals underlying the Company’s Insider Trading Policy, the Company’s directors, officers (those required to make filings under Section 16 of the Securities Exchange Act of 1934) and all employees at the Vice President level and above, as well as all employees in the accounting group are prohibited from buying or selling Company securities at all times, except during the period extending from the third (3rd) through the thirteenth (13th) business day following the release of the Company's earnings for the immediately preceding fiscal period to the public (the "Trading Window Period"). The prohibition on trading in Company securities by such persons at all times other than the Trading Window Period is designed to prevent any inadvertent trading by such persons in the Company's securities during times when there may be material financial information about the Company that has not been publicly disclosed. The grant or exercise of stock options to purchase the Company's stock is permitted outside Trading Window Periods (although any sale of such stock outside Trading Window Periods is prohibited unless such sale is made pursuant to an approved Rule 10b5-1 Trading Plan, as discussed below).

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Anil Dhawan answered almost 3 years ago

1. The Shipping Corporation of India Ltd. (hereinafter referred to as “the Company”) believes in the conduct of its affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behaviour. 2. The SEBI (Prohibition of Insider Trading) Regulations, 2015 [“the Regulations”] has laid down a framework for prohibition of insider trading in securities and requires a Code for Fair Disclosure and Conduct (‘the Code”) be laid down by companies to prevent such insider trading in securities. In line with such requirement, the Company has formulated the following guidelines which shall serve as the Code to prevent insider trading. All capitalized terms used and not defined herein, shall bear the meaning as defined under the Regulations. B. THE CODE: Compliance Officer 3. The Board shall appoint a senior officer as a Compliance Officer who shall be responsible for monitoring and regulating the policies as provided in the Code. 4. The Compliance Officer shall report to the Board of Directors of the Company and shall furnish such reports as may be required, to the Chairman of the Audit Committee, if any or to the Chairman of the Board of Directors, on quarterly basis. 5. The Compliance Officer will maintain a record of the shareholding of the employees and Designated Persons in the Company and any changes made therein. 6. The Compliance Officer would assist all the employees in addressing any clarification regarding the Regulations and Code. 7. The Compliance Officer shall also deal with dissemination of information and disclosure of Unpublished Price Sensitive Information. (UPSI)

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Pankaj answered almost 3 years ago

Insider TradingSCI CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING A. BACKGROUND: 1. The Shipping Corporation of India Ltd. (hereinafter referred to as “the Company”) believes in the conduct of its affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behaviour. 2. The SEBI (Prohibition of Insider Trading) Regulations, 2015 [“the Regulations”] has laid down a framework for prohibition of insider trading in securities and requires a Code for Fair Disclosure and Conduct (‘the Code”) be laid down by companies to prevent such insider trading in securities. In line with such requirement, the Company has formulated the following guidelines which shall serve as the Code to prevent insider trading. All capitalized terms used and not defined herein, shall bear the meaning as defined under the Regulations. B. THE CODE: Compliance Officer 3. The Board shall appoint a senior officer as a Compliance Officer who shall be responsible for monitoring and regulating the policies as provided in the Code. 4. The Compliance Officer shall report to the Board of Directors of the Company and shall furnish such reports as may be required, to the Chairman of the Audit Committee, if any or to the Chairman of the Board of Directors, on quarterly basis. 5. The Compliance Officer will maintain a record of the shareholding of the employees and Designated Persons in the Company and any changes made therein. 6. The Compliance Officer would assist all the employees in addressing any clarification regarding the Regulations and Code. 7. The Compliance Officer shall also deal with dissemination of information and disclosure of Unpublished Price Sensitive Information. (UPSI) Designated Persons The Designated Persons shall include the following: a. All Directors, including Chairman & Managing Director, whole-time Directors and non-Executive Directors, including Government Directors. b. Executive Directors / Senior Vice Presidents. c. Vice Presidents. d. All employees in the Finance & Accounts Department, Board Secretariat , PR Department,ISM Department and Accounts personnel in Profit Centres. e. Officers dealing with budgeting/monitoring of results in the Profit Centres. f. All employees in the Secretariats of Chairman & Managing Director, whole-time Directors and Executive Directors / Senior Vice Presidents. g. Connected Persons as defined under clause 2 of the Regulations which states as follows: Quote (d) "connected person" means,- (i) any person who is or has during the six months prior to the concerned act been associated with a company, directly or indirectly, in any capacity including by reason of frequent communication with its officers or by being in any contractual, fiduciary or employment relationship or by being a director, officer or an employee of the company or holds any position including a professional or business relationship between himself and the company whether temporary or permanent, that allows such person, directly or indirectly, access to unpublished price sensitive information or is reasonably expected to allow such access. (ii) Without prejudice to the generality of the foregoing, the persons falling within the following categories shall be deemed to be connected persons unless the contrary is established, - (a). an immediate relative of connected persons specified in clause (i); or (b). a holding company or associate company or subsidiary company; or (c). an intermediary as specified in section 12 of the Act or an employee or director thereof; or (d). an investment company, trustee company, asset management company or an employee or director thereof; or (e). an official of a stock exchange or of clearing house or corporation; or (f). a member of board of trustees of a mutual fund or a member of the board of directors of the asset management company of a mutual fund or is an employee thereof; or (g). a member of the board of directors or an employee, of a public financial institution as defined in section 2 (72) of the Companies Act, 2013; or (h). an official or an employee of a self-regulatory organization recognised or authorized by the Board; or (i). a banker of the company; or (j). a concern, firm, trust, Hindu undivided family, company or association of persons wherein a director of a company or his immediate relative or banker of the company, has more than ten per cent. of the holding or interest; NOTE: It is intended that a connected person is one who has a connection with the company that is expected to put him in possession of unpublished price sensitive information. Immediate relatives and other categories of persons specified above are also presumed to be connected persons but such a presumption is a deeming legal fiction and is rebuttable. This definition is also intended to bring into its ambit persons who may not seemingly occupy any position in a company but are in regular touch with the company and its officers and are involved in the know of the company’s operations. It is intended to bring within its ambit those who would have access to or could access unpublished price sensitive information about any company or class of companies by virtue of any connection that would put them in possession of unpublished price sensitive information. Unquote Protection of ‘Price Sensitive Information’ Information in regard to the following cases shall be considered as Price Sensitive Information: a. Financial Results b. Declaration of dividends (interim and final). c. Any change in Capital Structure d. Any major expansion plans or execution of new projects. For the purpose of this clause, major expansion plans shall mean “increase in DWT by 15% or more”. e. Amalgamation, merger, demerger, takeovers, delisting and buy-back. f. Disposal of whole or substantially the whole of the undertaking to the extent of 20% or more of the networth or 20% or more of the total income of the Company or 20% or more of the value of the undertaking, during the previous financial year, whichever is less. (The limit has been set based on the definition in section 180(1)(a) of the Companies Act 2013. ) This shall exclude mortgages. g. Any changes in policies, plans or operations of the Company which will have effect on networth to the extent of 20% or more. h. Changes in Key Managerial Personnel(except where the information is not generally available); and i. Material events in accordance with Listing Agreement. 8. All information shall be handled within the organisation on a need-to-know basis and no UPSI shall be communicated to any person except in furtherance of the Insider’s legitimate purposes, performance of duties or discharge of his legal obligations. Preferably, the. Unpublished Price Sensitive Information shall be disclosed only to the Chairman & Managing Director, Director (Finance), Senior Vice President (Accounts), the Officer dealing with Accounts Closing, such other Officers nominated by Director (Finance), Designated Officer in Budgeting & Control Department and Statutory Auditors.

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Open uri20170510 32134 1c996lj?1494421732 Anil answered almost 3 years ago

SEBI has issued and notified the SEBI (Prohibition of Insider Trading) Regulations, 2015 (Regulations) on 15th January, 2015. A high Level Committee (‘Committee’) was constituted by SEBI under the chairmanship of Justice Shri N.K Sodhi, former chief justice of Karnataka and Kerala High Courts and former presiding officer of the Securities Appellate Tribunal to review the Regulations. Based on the recommendation of the committee, these Regulations have been formulated. While some of the Regulations have been enacted at par with the international practices to bring more clarity, some of the Regulations are more onerous and testing for the corporate to implement at initial stage. The Regulations are precisely more clear in some aspects say as on what to be construed as price sensitive information by defining specifically “generally available information” separately. The said Regulation also laid down the concept of “pre-trading plan” for those insiders who are supposed to have unpublished price sensitive information throughout the year. The landmark deviation in new Regulations in context to the 1992 regulation is right of defense by the insider to rebut the charges of insider trading. The Regulations though establish all together a new set of governance by legislating these Regulations in all-inclusive way covering disclosures of trading by KMP/Directors/promoters as well as employees on crossing the threshold of Rs. 10 lakh in value. On the other hand, some Regulations have been left for open ended for discussion requiring clarity such as whether the stock options granted to employees can be exercised by employee during closure of trading window. Looking into the Regulations, it indicates that such ESOP can only be exercised if disclosed in trading plan as submitted by employee and further whether such trading plan can be executed during the closure of the trading window or not is not specifically mentioned. Another ambiguity in the Regulations relates to the requirement of disclosure of trades in securities by directors, promoters as well as employees on crossing the threshold of Rs. 10 lakhs in value, which seems to be too much arduous for the companies having market price of share above or approx. Rs. 1000 (means triggering disclosure on acquisition/dispose of approx.1000 shares). It would have been more rational to have the requirement of continual disclosure limited to KMP/directors/promoters on threshold of Rs. 10 lakh in value and for employees the threshold could have been kept at higher value say Rs. 15 or 20 lakh. The new Regulations also cast duties on the compliance officer appointed under the Regulations including monitoring and compliances of requirements under the Regulations. Such duties are to be undertaken very prudently. Say in case of employees where there is no requirement of initial disclosure but continual disclosure is required to be made in case of triggering the threshold. In such a case, it would be difficult for the compliance officer to check whether compliances are made or not. Above this, the Regulations also put an onus on the company to intimate trading crossing a threshold of Rs. 10 lakh in value irrespective of the disclosure receive by the employee as the Regulation 7(2)(b) states as follows- “Every company shall notify the particulars of such trading to the stock exchange on which the securities are listed within two trading days of receipt of the disclosure or from becoming aware of such information” Refer the above, it is very clear that company shall put in place a system to monitor trading of all its employees unlike of designated person as were required earlier regulations. What’s new in Regulations Connected person now also includes any person who is or has during the six months prior to the concerned act been associated with a company, directly or indirectly, in any capacity including by reason of frequent communication with its officers or by being in any contractual, fiduciary or employment relationship. Disclosures by KMP and employees. Open to the insider to prove his innocence by demonstrating the circumstances mentioned in the proviso of Regulation 4. Trading plans for Insiders who are in possession of unpublished price sensitive information. Companies to establish code of practices and procedures for fair disclosure of unpublished price sensitive information. Disclosures by other connected person or class of connected persons at the discretion of the company. Prohibition on communication: The Regulation 3 prohibits the insider from communicating, providing, or allowing access to any unpublished price sensitive information except where such communication is in furtherance of legitimate purpose, performance of duties or discharge of legal obligations. However in case of a transaction that would—(i)entail an obligation to make an open offer under the takeover regulation where the board of directors of the company is of informed opinion, or (ii)not attract the obligation to make an open offer under the takeover regulations but where the board of directors of the company is informed opinion that the proposed transaction is in the best interests of the company and the information that constitute unpublished price sensitive information is disseminated to be made generally available at least two trading days prior to the proposed transaction exemption from this Regulation has been provided Prohibition on trading : Regulation 4 prescribes that no insider shall trade in securities that are listed or proposed to be listed on stock exchange when in possession of unpublished price sensitive information. However there are certain exemptions i.e. when there is an off-market transfer between promoters who are aware of price sensitive information or where the trading is pursuant to trading plan. What is Trading plan It is basically introduced with the concept to have transparent frame for trading in securities by those insiders who are having unpublished price sensitive information through the year. The insider would be required to submit trading plan in advance to the compliance officer for his approval. The compliance officer is also empowered to take additional undertakings from the insiders for approval of the trading plan. Such trading plan on approval will also be disclosed to the stock Exchanges, where the securities of the company are listed. The trading plan shall comply with requirements as follows: (i) It shall be submitted for a minimum period of 12 months. (ii) No overlapping of plan with the existing plan submitted by Insider. (iii) It shall set out either the value of trades to be effected or the number of securities to be traded along with the nature of the trade and the intervals at, or dates on which such trades shall be effected. (iv) Trading can only commence only after 6 months from public disclosure of plan. (v) No trading between 20th day prior to closure of financial period and 2nd trading day after disclosure of financial results. (vi) Compliance officer to approve the plan. (vii) The trading plan once approved shall be irrevocable and the insider shall mandatorily have to implement the plan, without being entitled to either deviate from it or to execute any trade in the securities outside the scope of the trading plan.(Except in few case like where insider is in possession of price sensitive information at the time of formulation of the plan and such information has not become generally available at the time of the commencement of implementation) (viii) Upon approval of the trading plan, the compliance officer shall notify the plan to the stock exchanges on which the securities are listed. Disclosures: Disclosures made by person shall also include those relating to trading by such person’s immediate relatives, and by any other person for whom such person takes trading decisions. The disclosures of trading in securities shall also include trading in derivatives of securities if permitted under law (please note that section 194 of the Companies Act, 2013 prohibits Director or KMP from entering into forward dealings etc.) Such disclosure shall be preserved for 5 years. Disclosure are classified as Initial and continual disclosures.

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Anshul Dhawan commented over 1 year ago

Good answer, keep it up

Open uri20170510 32134 59004f?1494421790 Anshul Dhawan answered almost 3 years ago

General Rule. Directors, officers and employees of the Company shall not effect any transaction in the Company’s securities if they possess material, nonpublic information about the Company. This restriction generally does not apply to the exercise of stock options under the Company's stock option or deferred compensation plans, but would apply to the sale of any shares acquired under such plans. The provisions set forth in this Paragraph VI and all other provisions of this Insider Trading Policy shall equally apply to the directors, officers and employees of any subsidiary of the Company, except as noted in the "Trading Window Periods" paragraph below. Pre-Clearance by Compliance Officer. Every director, officer or employee of the Company shall advise the Compliance Officer before he or she effects any transaction in the Company's securities. This shall be done by submitting a completed Trading Approval Form, attached as Exhibit A, to the Compliance Officer. The Compliance Officer shall advise such director, officer or employee whether the proposed transaction is permissible under this Insider Trading Policy by making the appropriate indication and countersigning the Trading Approval Form. Trading Window Periods. Investment by the Company’s directors, officers or employees in Company securities is encouraged, so long as such persons do not purchase or sell such securities in violation of this Insider Trading Policy. In furtherance of the goals underlying the Company’s Insider Trading Policy, the Company’s directors, officers (those required to make filings under Section 16 of the Securities Exchange Act of 1934) and all employees at the Vice President level and above, as well as all employees in the accounting group are prohibited from buying or selling Company securities at all times, except during the period extending from the third (3rd) through the thirteenth (13th) business day following the release of the Company's earnings for the immediately preceding fiscal period to the public (the "Trading Window Period"). The prohibition on trading in Company securities by such persons at all times other than the Trading Window Period is designed to prevent any inadvertent trading by such persons in the Company's securities during times when there may be material financial information about the Company that has not been publicly disclosed. The grant or exercise of stock options to purchase the Company's stock is permitted outside Trading Window Periods (although any sale of such stock outside Trading Window Periods is prohibited unless such sale is made pursuant to an approved Rule 10b5-1 Trading Plan, as discussed below). -3- Black-out Communications. In addition to the foregoing restrictions, the Company reserves the right to issue "black-out notices" to specified persons when material, nonpublic information exists. Any person who receives such a notice shall treat the notice as confidential and shall not disclose its existence to anyone else. Trading in Securities of Other Entities. In addition, no director, officer or employee of the Company shall effect any transaction in the securities of another entity, the value of which is likely to be affected by actions of the Company that have not yet been publicly disclosed. Please note that this provision is in addition to the restrictions on trading in securities of other entities set forth any Code of Ethics of the Company. Applicability to Family Members. The foregoing restrictions on trading are also applicable to family members’ accounts, accounts subject to the control of personnel subject to this Insider Trading Policy or any family member, and accounts in which personnel subject to this Insider Trading Policy or any family member has any beneficial interest, except that the restrictions on trading do not apply to accounts where investment decisions are made by an independent investment manager in a fully discretionary account. Personnel subject to this Insider Trading Policy are responsible for assuring that their family members comply with the foregoing restrictions on trading. For purposes of this Policy, "Family Members" include one’s spouse and all members of the family who reside in one's home. Rule 10b5-1 Trading. Notwithstanding the restrictions stated in this Paragraph VI, such restrictions shall not apply to purchases or sales of securities of the Company made by the persons covered hereby who have entered into a written trading plan that complies with Rule 10b5-1 of the Exchange Act and has been approved by the Compliance Officer.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 phool chandra singh answered almost 3 years ago

Dear, your query is that what is trading window in insider trading? answer of your query is that The period in which a company permits its executives and key employees to trade its stock; also called a window period. This is the opposite of a blackout period, during which a company's policy on insider trading forbids executives and key employees to make transactions in company stock. For details on insider-trading prevention and compliance Thanks & Regards,

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