SEBI: Market regulator SEBI has set a date for making major changes for the Mutual Funds industry. To promote transparency in mutual funds, new insider trading rules are going to be implemented from November 1. With the help of new rules, the functioning of asset management companies will also improve. Under the new rules, special attention will have to be paid to employees who have sensitive information. Also, such employees will have to sign an agreement.
Confidentiality agreement will have to be signed
According to market experts, under the new rules, mutual fund companies will have to maintain transparency regarding employees who have price sensitive information. Such employees will be considered as nominees. They will be identified as Designated Persons. Under the new rules, a list of employees and other persons who have access to sensitive information will have to be maintained. All of them will have to sign a confidentiality agreement. This will help SEBI in preventing insider trading.
There was a delay in implementing the rules due to opposition from the industry
SEBI issued a notification on July 26 saying that the new insider trading rules will come into effect from November 1, 2024. Under the new rules, asset management companies will have to review their internal controls from time to time. SEBI had issued a consultation paper in July 2022 regarding insider trading and buying and selling in mutual fund companies. But, according to market experts, there has been a delay in implementing the new rules due to opposition from the industry.
AMC, trustees and their relatives will have to disclose their holdings
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