LO 0706
Investment and Securities Law :
Objectives of
the Course : The securities market plays a very important role in the
growth and development of Indian market economies. Mature and well-regulated
securities market supports corporate initiatives and also facilitate the
management of financial risks. Also, retail investors are investing an
increasing proportion of their money in mutual funds and other collective
investments which places the securities markets at the central of individual
wealth. This course aims to introduce students to the various laws and
regulations enacted by the competent legislative and regulating bodies
governing the operation and movement of security market.
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Module 01 |
Historical evolution
of Investment and Securities Laws : 1.
Meaning and Definition of Investment and
Securities 2.
Historical origins of Investment and
Securities law - International and National Perspective 3.
History of Capital Markets in India 4.
Need for securities legislation and investor
protection |
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Module 02 |
Regulatory Framework
to Govern Securities in India : 1.
Concept of Securities 2.
Kinds of Securities - Ownership instruments,
Shares, Stocks 3.
Debt instruments - Debentures and Bonds 4.
Offered Documents - Prospectus 5.
Norms of disclosure under different laws - the
Companies Act, 2013, the Securities Contracts (Regulation) Act, 1956 and the
Securities Exchange Board of India Act, 1992 (only relevant provisions) |
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Module 03 |
Concept of
Securities Market and Securities Market Intermediaries : 1. Primary Market : Scheme of Primary Market, Advantages -
Disadvantages to Companies and investors.
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2.
Provisions relating to IPO, FPO, Private
placement, bonus issue, Qualified Institutional Placement
under the SEBI (Issue of Capital and Disclosure Requirement) Regulations,
2018 3.
Primary Market intermediaries - Merchant
Banker, Managers to issue, Registrar and Share Transfer Agent, Bankers to the
issue, Brokers, Syndicate Members 4.
Secondary Market intermediaries - Registrar
and Share Transfer Agent, Brokers / sub-brokers, Portfolio Managers,
Investment Advisers, Research Analyst, Credit Rating Intermediaries, Clearing
Corporations |
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Module 04 |
Securities and
Exchange Board of India and the Depositories Act, 1996 : 1.
Background and Introduction, Constitution of
SEBI 2.
SEBI - Power and Functions, Role of SEBI in
securities market. 3.
SEBI - Power to issue Informal Guidance 4.
SEBI - Power to issue Regulations, Rules under
Securities Market 5.
Constitution of Securities Appellate Tribunal
(SA), SAT - Power and Functions 6.
The Depositories Act, 1996 - Rights and
Obligations of depositories, Depository Participants, Issuers and beneficial
owners, Penalties. Dematerialisation and
Rematerialisation of securities (Procedure, Advantages and Disadvantages) 7.
Relevant provisions of the Companies Act, 2013
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Module 05 |
Stock Exchange and
Investor Protection : 1.
The Securities Contracts (Regulation) Act,
1956 - Recognized stock exchanges, listing of securities, penalties and
procedure 2.
Procedure for a stock exchange to be a
recognized Stock Exchange, Power of Government, procedure for de-recognition
of a stock exchange 3.
Concept of Demutualization of stock exchanges
and its impact on the Indian economy and the Regional stock exchanges 4.
Minimum public shareholding and its advantages
to shareholders and stakeholders 5.
Trading, Spot delivery contract, Badla
Contract, Future contracts, Options, 6.
Derivatives, Listing of Shares 7.
Investors Protection mechanism under various
statutes - Role and functions of SEBI Tribunal, the Companies Act, 2013 -
Acceptance of deposits, Misstatement in prospectus, fraudulently inducing
person to invest money, non-payment of dividend, Right to demand financial
statement, Investor Education and Protection Fund, class action suits |
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Module 06 |
Insider Trading
and Takeover Code : |
Insider Trading :
1. Insider
Trading : Meaning and Definition of Insider Trading. Insider, Connected person,
deemed to be connected, trading, Unpublished price sensitive information,
generally available information, Chinese wall, Compliance Officer, Trading Window,
Pre-clearance, Code of Conduct
2. Penalty
for Insider Trading 3. Position in UK and USA Takeover
Code :
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1.
Meaning and definition of control, voting
rights, shares, acquirer, target company, Person acting in concert, Deemed to
be connected person, acquisition of shares, open offer, public announcement,
offer letter, offer price 2.
Shareholding thresholds / Triggers under
Takeover Code 3.
Procedure of public announcement and open
offer 4.
Exemptions (general and specific exemptions) |
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Module 07 |
SEBI (Listing
Obligations and Disclosure Requirement Regulations) : 1.
Meaning and purpose of listing and delisting,
advantages and disadvantages 2.
Principles governing disclosures and
obligations of listed entity 3.
Listing Agreement 4.
Compliance Officer 5.
Grievance Redressal Mechanism 6.
Corporate Governance Norms - directors, women
directors, independent directors, audit committee, risk management committee,
remuneration committee, stakeholder relationship committee, maximum number of
directorships, related party transactions, obligations of independent
directors 7.
Disclosure of event or information under SEBI
Regulations 8.
Re-classification of promoters into
non-promoters 9. Annual report |
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Module 08 |
Foreign Investment
Laws : 1.
The Foreign Exchange Management Act, 1999
- a)
Regulation and management of Foreign Exchange b) Contravention
and Penalties c)
Adjudication and Appeal d) Directorate
of enforcement e)
Inbound and outbound investment in India
(Foreign Direct Investment and Overseas Direct Investment) f)
Setting up of Joint Ventures and Wholly owned
subsidiaries in India and outside India 2.
Regulation of Foreign Institutional Investors
(FII) / Foreign Portfolio Investor (FPI) in India 3.
Participatory Note |
Recommended Readings :
1. Sanjeev
Agarwal, Guide to Indian Capital Market,
Bharat Law House, 2009.
2. Imaad
A Moosa, Foreign Direct Investment:
Theory Evidence and Practice, Palgrave MacMillan, 2010.
3. Niti
Bhasin, FDI In India, New Century
Publication, 2008.
4. V.A.
Avdhani, Investment and Securities Market
in India, Himalaya Publishing House, 2011.
5. Vishal
Saraogi : Capital Markets and Securities
Laws Simplified, Lawpoint Publication.
6. E.
Gordon & K. Natarajan: Capital Market
in India; Himalaya Publishing House.
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