Archive · 27 Jul 2026
Companies seek legal advice to prevent insider trading
Companies in India are now asking lawyers for help to stop insider trading before it happens.
They want to know what information is secret, who can see it, and how to keep it safe.
The government has rules to stop people from cheating in the stock market using secret information.
Companies are making special digital logs to track who sees what and when.
They are also checking their own systems to make sure no one is breaking the rules.
This helps them avoid trouble with the government.
Some companies are even doing their own investigations if they think something fishy is going on.
The government is also watching more closely and has more people to catch rule-breakers.
Companies are seeking legal advice to prevent insider trading proactively.
Sebi has tightened insider trading rules, requiring companies to maintain structured digital databases (SDD) for tracking UPSI.
Companies are investing in internal investigations and compliance systems to avoid regulatory scrutiny.
Boards are seeking guidance on trading windows, designated persons, and potential scrutiny of promoter relatives' trades.
Sebi's investigations department has expanded significantly, with more verticals and divisions by 2025.
- Who
- Listed companies and their boards
- What
- Seeking legal advice to prevent insider trading
- When
- Over the past few years, with significant changes in 2018 and 2020
- Where
- India
- Why
- To comply with stricter insider trading regulations and avoid regulatory scrutiny
Proactive Compliance
Reactive Compliance
Approach to Insider Trading Prevention
Proactive Compliance
Companies are investing in proactive governance systems, internal surveillance, and training to prevent insider trading violations and demonstrate compliance.
Reactive Compliance
Some companies may still rely on reactive measures, addressing issues only when they arise or when regulatory scrutiny is imminent.
- Regulator
- Securities and Exchange Board of India (Sebi)
- Key Regulation
- Structured Digital Databases (SDD)
- UPSI Examples
- Financial results, mergers, major business decisions
- SDD Mandate Year
- 2018
- SDD Effective Date
- 1 April, 2019
- Expanded Framework Year
- 2020
- Investigations Verticals by 2025
- 3
- Investigation Divisions by 2025
- 23