The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended (“PIT Regulations”) prohibits trading in listed securities when in possession of unpublished price sensitive information (“UPSI”). In order to enhance regulatory compliance, the Securities and Exchange Board of India (“SEBI”) has with effect from June 10, 2025 introduced certain amendments to the definition of UPSI under the PIT Regulations (“PIT Amendments”).

The PIT Amendments aim to align the existing definition of UPSI under the PIT Regulations, which sets out an illustrative list of events constituting UPSI, with material events that are required to be publicly disclosed as part of ongoing disclosures under Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (“LODR Regulations”).

This note analyzes the PIT Amendments and explains how the expansion of the definition of UPSI will recalibrate compliance obligations for listed companies and their insiders.

Amendments to the Definition of UPSI

UPSI has been defined under Regulation 2(1)(n) of the PIT Regulations to mean “any information, relating to a company or its securities, directly or indirectly, that is not generally available which upon becoming generally available, is likely to materially affect the price of the securities…”. Prior to the PIT Amendments, the definition of UPSI included a non-exhaustive list of events such as information in relation to:

  1. financial results;
  2. dividends;
  3. change in capital structure;
  4. mergers, demergers, acquisitions, delistings, disposals, and expansion of business and such other transactions; and
  5. changes in key managerial personnel.

Under the PIT Amendments, the definition of UPSI has been amended to include information relating to the following events:

  1. award or termination of order/contracts not in the normal course of business (in addition to mergers, demergers, acquisitions, delistings, disposals and expansion of business and such other transactions);
  2. changes in key managerial personnel other than due to superannuation or end of term, and resignation of a statutory auditor or secretarial auditor;
  3. change in rating(s), other than ESG rating(s);
  4. fund raising proposed to be undertaken;
  5. agreements, by whatever name called, which may impact the management or control of the company;
  6. fraud or defaults by the company, its promoter, director, key managerial personnel or subsidiary or arrest of the above persons, whether in India or abroad;
  7. resolution plan/ restructuring or one-time settlement in relation to loans/borrowings from banks/financial institutions;
  8. admission of winding-up petition filed by any party/creditors and admission of application for initiation of corporate insolvency resolution process against the company as a corporate debtor by any corporate applicant/financial creditors, approval of resolution plan or rejection thereof under the Insolvency and Bankruptcy Code 2016;
  9. initiation of forensic audit, by whatever name called, by the company or any other entity for detecting mis-statement in financials, misappropriation/siphoning or diversion of funds and receipt of final forensic audit report;
  10. action(s) initiated or any orders passed against the company or its directors, key managerial personnel, promoter or subsidiary in relation to the company, within India or abroad by any regulatory authority, statutory authority, enforcement authority or judicial body;
  11. outcome of any litigation(s) or dispute(s) which may have an impact on the company;
  12. giving of guarantees or indemnity or becoming a surety, by whatever name called, for any third party, by the company not in the normal course of business; and
  13. granting, withdrawal, surrender, cancellation or suspension of key licenses or regulatory approvals.

These are in addition to the earlier non-exhaustive events set out above.

For the purpose of identification of events/information as UPSI and materiality, the guidelines/thresholds specified in the LODR Regulations will be applicable and the “Industry Standards on Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015” issued by SEBI on February 25, 2025 will also be required to be reviewed by listed companies. Certain flexibility has been given to listed companies under the PIT Amendments: (i) in order to make entries in the structured digital database on a deferred basis, i.e., within two calendar days from receiving the information; and (ii) for UPSI that does not originate from inside the listed company, the trading window does not need to be closed.

Need for Review and Public Consultation

Recognizing that the original definition of UPSI, with its five illustrative categories, no longer captured a number of price-sensitive events which led to inconsistencies in disclosure practices and concerns in relation to information asymmetry, the SEBI issued a consultation paper on November 9, 2024 proposing alignment with the LODR Regulations.

After public feedback and working-group deliberations, the SEBI board cleared the revisions on December 18, 2024 to “enhance regulatory clarity, certainty and uniformity in the compliance ecosystem.” The PIT Amendments were issued on March 11, 2025 and came into force on June 10, 2025.

Interplay Between the PIT Regulations and Material Events Under Regulation 30 of the LODR Regulations

Under Regulation 30 of the LODR Regulations, listed companies are required to make ongoing stock exchange disclosures within the specified timelines whenever a “material event” occurs. However, until now, the same events were not automatically ring-fenced as UPSI and insiders could trade, so long as the event did not fit into one of the earlier non-exhaustive UPSI categories.

The integration of specific material events from Regulation 30 of the LODR Regulations with the definition of UPSI signifies SEBI’s commitment to aligning disclosure requirements and ensures that material events, which are required to be disclosed to stock exchanges under the LODR Regulations are also recognized as UPSI under the PIT Regulations.

Conclusion

Listed companies will now need to reassess their internal policies and procedures to ensure compliance with the amended definition of UPSI. This will include amendments to their respective codes of conduct, timely identification and disclosure of material events specified under Regulation 30 of the LODR Regulations and stricter structured database protocols.

This insight has been authored by Meher Mehta, Ayushi Singh and Maideni Shukla from S&R Associates. They can be reached at [email protected], [email protected] and [email protected], respectively, for any questions. This insight is intended only as a general discussion of issues and is not intended for any solicitation of work. It should not be regarded as legal advice and no legal or business decision should be based on its content.