Investment/ trading in securities by employees and Board members of AMC(s) and Trustees of Mutual Funds
Summary
This circular partially modifies the norms for investment and trading in securities by employees and Board members of Asset Management Companies (AMCs) and Trustees of Mutual Funds. It updates the definition of 'Access Person' to include specific senior roles and non-executive directors with access to material non-public information. The document introduces relaxation mechanisms for the 'cooling off' period and clarifies reporting requirements for mutual fund unit transactions. This section establishes the applicability of guidelines to all employees and defines 'Access Persons' who hold sensitive information. It outlines prohibited activities such as insider trading and mandates prior approval for personal securities transactions by designated personnel. Specific rules govern investments in primary markets, including public issues and rights offers, while secondary market transactions require written applications. Section 2.4.2 details the pre-clearance process for secondary market transactions by access persons, including cooling-off periods and exemptions. Section 2.5 outlines reporting requirements and prohibitions regarding investments in Mutual Fund units by employees and des
Text
Access Person means Head of AMC, Executive Directors, CIO, CRO, COO, CISCO, Fund Managers, Dealers, Research Analysts, Fund Operations employees, Compliance Officer, Heads of divisions, and Non-Executive Directors possessing material non-public information.
Investments in government securities, overnight schemes and schemes of other Mutual Funds are not covered under these guidelines.
All employees shall refrain from profiting from the purchase and sale or sale and purchase of any security within a period of 30 calendar days from the date of their personal transaction.
Such relaxation shall be given by Compliance Officer for not more than 2 times in a financial year per Access Person.
Such relaxation shall be applicable only for sale of securities.
Such relaxation shall be applicable only for securities held by the Access Person for not less than a period of one year.
Access Person may apply anytime during the financial year for such relaxation to the Compliance Officer. Compliance Officer shall decide on the said application within 5 days of receipt of such application.
Access Person may sell the securities within 10 trading days from the date of clearance by the Compliance Officer.
The Access Person shall ensure that from the time of making an application under clause (d) till the conclusion of the sale of the concerned securities, he/she is not in possession of / does not have access to any non-public information which could materially impact the price of the concerned securities.
The Compliance Officer shall maintain all other regulatory checks and obtain necessary undertakings from the Access Person.
Access person shall... declare to the Compliance Officer (i) details of all the pre-existing pledges / encumbered arrangements... and (ii) details of ESOPs bought with borrowed funds, along with the agreement with such lender.
The Access Person shall ensure... that the Access Person has not engaged directly or indirectly in front-running, self-dealing, trading while in possession of non-public information... and that the sale by the lender was due to shortfall of margin...
You have read the preview. Create a free account to read the full document and see every order that applied it.
Free accounts include 10 searches/day with full text access.
Source: SecMarx — Investment/ trading in securities by employees and Board members of AMC(s) and Trustees of Mutual Funds. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.