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In an effort to check instances of front running in capital markets, the market regulator has proposed revision of definition of connected person in the prohibition on insider trading (PIT) norms.
The connected person is related to someone who has access to Unpublished Price Sensitive Information (UPSI) because of their relationship with the company. This connected person might not hold an official position in the company but has close ties to someone in the company, allowing them to access sensitive information.
Expanding the scope, SEBI has proposed definition of connected person by including spouse, siblings, siblings of a spouse, siblings of parents, any direct ancestors or descendants and all their spouses.
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