India’s top listed companies must investigate and correct market rumours within hours under new rules from the Securities and Exchange Board of India (SEBI).
The new Listing Obligations and Disclosure Requirements regulation 30(11) requires listed entities to confirm or deny any reported event or information in the mainstream media that hints at rumours of specific material events. This is to prevent the potential sway of rumours on market sentiments, and to safeguard the interests of investors and stakeholders.
The amendment applies to the top 100 listed entities (starting from 1 October 2023) and, subsequently, the top 250 listed entities (from 1 April 2024).
These entities must confirm, deny or clarify rumours circulating in mainstream media within 20 hours. If the rumour is confirmed, the current stage of the reported event should also be communicated.
The definition of “mainstream media” encompasses newspapers registered with the Registrar of Newspapers for India, news channels permitted by the Ministry of Information and Broadcasting under the government, content from publishers of news and current affairs as per the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, and similar sources from jurisdictions outside India.
Disclosures are required only for information that’s material under regulation.