Summary
- SEBI has clarified that a person can be classified as an "insider" even if they are not a connected person, based on possession of unpublished price sensitive information (UPSI).
- This distinction was highlighted in the Religare Enterprises Limited case, where UPSI originated from the Burman Group, not REL.
- The ruling emphasizes that a person's position in a company does not automatically confer insider status if the information comes from outside the listed entity.
- This could significantly impact how insider trading cases are prosecuted, particularly in acquisitions and mergers where UPSI may come from acquirers rather than target companies.
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