SEBI will evolve consenus on insider trading norms

New Delhi, Jan 2 (UNI) SEBI Chairman M Damodaran today said it will follow a consultative process while finalising norms relating to insider trading, including reviewing of the 10 per cent limit stake held by directors or key management personnel in a company being brought under such guidelines.

''What we have put out yesterday is a paper for discussion. We will get, over the next month or so, views on that. After we take all those views on board, a clear position will emerge,'' Mr Damodaran told reporters on the sidelines of a conference here.

The SEBI Chairman said that this was the practice followed in some other countries, including the United States.

Mr Damodaran said the Securities and Exchange Board of India wants to emulate this process.

He said SEBI will seek the views of experts, media, academicans and others on the draft guidelines put out by it yesterday.

He said whether 10 per cent limit of stake held by officers or promoters was too high or low would be finalised after receiving public comments.

In a move to curb insider trading, SEBI proposed that company insiders should surrender profits made in any equity-based securities transactions of the company, if both the buy and sell side of the transaction are entered into within six months of the other.

According to the draft guidelines, a Company insider is any officer, director or holder of more than ten per cent of the company's shares. By virtue of their position these people have greater access to price sensitive company information.

UNI GS-BJR HT1554