Bajaj Finance Amends Fair Disclosure Code; Board Approves Changes

The ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI)’ includes definitions, code, and policy for determination of “legitimate purposes”. The term “legitimate purposes” includes sharing of Unpublished Price Sensitive Information (“UPSI”) in the ordinary course of business on a need-to-know basis, with partners, collaborators, lenders, customers, suppliers, merchant bankers, legal advisors, auditors, insolvency professionals or other advisors or consultants, provided that such sharing has not been carried out to evade or circumvent the prohibitions of the SEBI (Prohibition of Insider Trading) Regulation, 2015 and amendment made therein form time to time.

Principles for determining legitimate purpose include the person seeking information must have authority, power and capacity to seek the information; the person providing information must have authority, power and capacity to provide the information; the purpose for which information is sought or is to be provided must be disclosed; the information is necessary for the purpose; the information to be shared would not serve its purpose if it is shared after it is publicly disclosed, and the sharing of the same forthwith or within a reasonable time is necessary for the purpose; the requirement of information should not be conditional or qualified; whether the information is sought or is provided for meeting any regulatory/legal requirement; whether the information is sought or is provided to any regulator; the sharing of information is consistent as per past practice; information sought or shared should not be for the purpose of trading in securities of the Company; and the information sharing circumvent any law.

Deemed legitimate purposes include financial information shared with auditors for obtaining limited review report, auditor's report, certificate, other services as may be required to be provided by the statutory auditors under the extant regulations; for investigation, inquiry or request for information by statutory or regulatory or governmental authorities or any other administrative body recognized by law; under any proceedings or pursuant to any order of courts or tribunals; as part of compliance with applicable laws, regulations, rules and requirements to legal advisors, merchant bankers, lenders, insolvency professionals, debenture trustees, secretarial auditor, practicing chartered accountant/ practicing company secretary, share transfer agent, security trustees for lenders, depositories and custodians, IT tool/system providers/facilitators, other advisors / consultants, shared service providers, service providers, system auditors, such other persons by whatever name called who may be required to be engaged by the Company from time to time; arising out of any contractual obligations or arrangement entered by the Company or the holding company or promoter(s) set forth in any contract, agreement, arrangement, settlement, understanding or undertaking; sharing the relevant information with persons engaged or involved in the processes leading to disclosure of events set out in Schedule III to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Process for sharing UPSI includes satisfy that information is an UPSI and sharing the same would be in line with the principles laid hereinabove; identify the persons with whom the information is to be shared; notify the recipient that UPSI is being shared, and either serve notice of confidentiality or enter into a confidentiality/non-disclosure agreement; to make such persons aware that the information shared is UPSI, such that the persons are aware of their duties and responsibilities and also the liability for any misuse or unwarranted use of the UPSI shared; in case information is shared to any regulator, the requirement mentioned at point 3 and 4 may be dispensed with; mode of sharing UPSI shall be either by an email or hard copy or any other electronic mode or device or provide access to the information, data, servers, etc.

A person in receipt of UPSI pursuant to a “legitimate purpose" shall be considered an "insider" for purposes of the SEBI Insider Trading Regulations.

A structured digital database containing the names of such persons or entities as the case may be with whom UPSI is shared along with the Permanent Account Number or any other identifier authorised by law where Permanent Account Number is not available shall be maintained. Such databases shall be maintained with adequate internal controls and checks, such as time stamping and audit trails to ensure non-tampering of the database.

Any sharing of information to evade or circumvent the prohibitions under the Regulations would not be considered as sharing of information for legitimate purpose.

The Policy shall be reviewed periodically in accordance with review of internal control and check as well as changes or any regulatory requirements from time to time.

In the events of inconsistency of this Policy with any legal provisions, the provisions of the law shall override this Policy.