SSAS & Associates LLP
Quick Summary
Requirement of structured database under Regulation 3 of SEBI (Prohibition of Insider Trading Regulations) 2015
W.e.f. 01st April 2019 it is mandated that under Regulation 3(5) of the SEBI PIT Regulations a structured database has to be maintained by the listed entity.
As per Regulation 3 an unpublished price sensitive information may be communicated, provided, allowed access to or procured, in connection with a transaction that would:-
- Entail an obligation to make an open offer under the takeover regulations where the board of directors of the listed company is of informed opinion that sharing of such information] is in the best interests of the company;
- Not attract the obligation to make an open offer under the takeover regulations but where the board of directors of the listed company is of informed opinion that sharing of such information is in the best interests of the company and the information that constitute unpublished price sensitive information is disseminated to be made generally available at least two trading days prior to the proposed transaction being effected in such form as the board of directors may determine to be adequate and fair to cover all relevant and material facts.
The UPSI shares under above two circumstances are required to be kept recorded by maintaining a structured digital database which provides time stamping and internal controls and checks containing:
- Names of such persons or entities with whom information is shared
- Permanent Account Number or any other identifier authorized by law where Permanent Account Number is not available
In all other cases, except as required under regulation 3 as above, maintenance of structured digital database is not required.
FAQ :
Listed entities are mandated to maintain a structured digital database under Regulation 3(5) of the SEBI PIT Regulations since April 1st, 2019.
It is required when Unpublished Price Sensitive Information (UPSI) is communicated, provided, allowed access to, or procured in connection with a transaction that entails an obligation to make an open offer, or one that doesn't but where the board believes sharing is in the company's best interest and the information will be made generally available.
The database must include time stamping, internal controls and checks, the names of persons or entities with whom information is shared, and their Permanent Account Number (PAN) or another authorised legal identifier.
Yes, in all cases except those specifically required under Regulation 3 as outlined, the maintenance of a structured digital database is not required.
The requirement for listed entities to maintain a structured digital database under Regulation 3(5) of the SEBI PIT Regulations became effective from April 1st, 2019.
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