SIT strengthens the disclosure of PIT for persons designated by MF

Capital market regulator SEBI has mandated asset management companies (AMCs) to disclose details of holdings of AMC nominees, trustees and their immediate family members on an aggregate basis from l November 1 of each quarter.

Holdings on October 31 will be published on the stock exchange platform before November 15. Thereafter, for all subsequent calendar quarters, AMCs will provide the information within 10 calendar days of the end of the quarter.

With the aim of strengthening the regulatory framework in relation to the prohibition of insider trading in mutual fund (MF) holdings, SEBI has notified the amendment of the Prohibition of Insider Trading (PIT) Regulations ), which will enter into force from November 1.

In order to speed up the application of the PIT regulation, a working group formed by representatives of AMC, AMFI, stock exchanges, RTA and Depositories was set up, which made its recommendations on the implementation of the new amendments.

New rules

AMCs are required to disclose details of all transactions in units of their own MFs executed by the nominees, trustees and their immediate relatives above the threshold limit of more than ₹ 15 lakh, in one or a series of transactions during any calendar quarter, by PAN in all systems except exempt ones. AMC’s AMC Compliance Officer must ensure disclosure within two business days of the transaction date.

All employees must refrain from profiting from the purchase and sale of any security within 30 calendar days from the date of their personal transaction, SEBI said.

However, in cases where such agreements are executed within 30 days, the employee must provide an adequate explanation to the compliance officer who must report this to the AMC board and the patterns at the time of review, SEBI said.