How should we regulate Insider Trading? A Call for the Limited Parity of Information (“LPI”) Theory
Welcome to this lunch seminar with presentation by Shilpi Nanda, National University of Singapore.
Open for all interested. Please register your participation below.
About the topic
During this lunch seminar, the author takes the audience through the journey of the various ways in which insider trading has been regulated in the past sixty years. The author argues the most appropriate theory to rationalise the regulation of insider trading is one which can uphold the same standard of liability for all market investors for the benefit of “market fairness” - and also recognise that equality of information amongst these investors cannot be absolute for the benefit of “market efficiency”. The LPI theory imbibes both these characteristics and strives for equal access of information amongst market investors while permitting unequal access of information on certain occasions for informed decision-making for transactions. These unique characteristics of the LPI theory provide a desirable scope for insider trading prohibition when adopted to shape the insider trading legislation of a jurisdiction. This theoretical framework stands in contrast to opposing theories such as the strict parity of information and fiduciary duty theories (which to date are widely prevalent in countries such as the US).
The seminar will include interesting examples from every-day life scenarios to demonstrate why the LPI theory applies in a straightforward, less contentious and a more coherent manner as compared to its opposing theories. Examples are also taken from insider trading legislations of the EU, Singapore, Australia and India to demonstrate the efficacy of the LPI theory in regulating insider trading. These jurisdictions demonstrate a convergence towards the LPI theory and how that has been a positive development towards a higher standard of insider trading governance.
Please register your participation below and we will send you the Zoom-link for the lunch seminar.