Tribunal litigation is exciting. Unlike the courts, which can deal with matters related to multiple legislations, tribunals provide an opportunity to specialise in a specific area. Securities law is an immensely interesting area of practice for those interested in commercial litigation work.
It also provides young lawyers an opportunity to specialise and make a name early in their career. Unlike the High Courts and Supreme Court thronged by tens of thousands of lawyers, SAT litigation attracts fewer but high quality lawyers.
SAT matters are high stakes. If someone delves into this area with any seriousness, it can be very rewarding. Since these matters require an in depth understanding of securities laws, many lawyers do not possess such expertise and therefore avoid this work. You are therefore likely to meet with lesser competition.
Another misconception lawyers have is that they believe securities laws to be very complex, and that they require elaborate quantitative skills to understand such laws.
However, it takes no more than a 10th grader’s quantitative skills to be able to handle securities matter efficiently.
If you take a look at which lawyers represent clients before the Securities Appellate Tribunal, you will find that they are not necessarily from top tier law firms such as Shardul or Cyril Amarchand Mangaldas, Trilegal or AZB.
Most of them are from second and third tier law firms. Some are independent litigators too. Lawyers who are experts at securities laws can advise clients on how to achieve the desired objectives without landing into a breach or generating suspicion which would invite regulatory action. If you are able to plan transactions in such a way, you are going to be in great demand.
What does that imply? Securities litigation is not a domain which is saturated or monopolized by a few firms, and there are huge opportunities for independent litigators and smaller law firms as well.
As an independent litigator or someone who runs his own law firm, this is an excellent practice area to delve into, especially if you are interested in financial and securities laws or commercial litigation.
Factors such as a slowdown in the economy will impact the volume and size of transactional work. Similarly, the implementation of artificial intelligence in the legal industry will automate many aspects of it.
However, disputes work increases in volume when there is an economic slowdown. It is also more immune to technological developments such as artificial intelligence.
Securities litigation work involves significant sums of money which are at stake because of a regulatory dispute. It is possible for a lawyer to very clearly demonstrate beneficial results to a client, and charge a premium for excellence.
In most cases before the Securities Appellate Tribunal the respondent is either SEBI or a stock exchange. Sometimes, the actions by the regulator can be arbitrary. If you are able to contest against such actions before the tribunal and win, this can not only be an incredible boost to your confidence, it can result in winning you more clients.
I witnessed a SAT hearing recently where a penalty levied by the regulator was reduced by INR 10 lakhs in a matter of less than 30 minutes. The client was elated!
Imagine how grateful he would be to the lawyer. Also imagine how such amazing results will enable a lawyer to charge a premium to a client.
Another peculiar aspect of the Securities Appellate Tribunal is that as on the date of writing this in July 2019, there is only one bench of SAT and that is in Mumbai. Hence, it isn’t like the National Company Law Tribunal, for instance, which has quite a few regional benches. There is less accessibility and lesser competition with respect to SAT in comparison with other tribunals such as the NCLT. If you specialise and create a name for yourself, even if you’re based outside Mumbai, your client will be willing to fly you and put you up in a nice hotel. Also, listed companies with corporate headquarters in other cities are happy to keep lawyers with this expertise on their panel or payroll, if such experts are at all available in their own city, which is rare.
You need to understand the provisions and intention behind the SEBI Act, its regulations and processes, the prevailing mechanism for protecting the ‘market’ from abuse, how various players are always trying to game the system given huge stakes involved, investor’s interest and so on. You need to develop the ability to apply litigation skills in conjunction with such specialised knowledge.
Many aspects of securities litigation are unique. You will need to understand various concepts behind SEBI’s regulations for IPOs and listing of debt securities and other instruments, Listing Obligations and Disclosure Requirements Regulations, Delisting Guidelines, Insider Trading Regulations, Unfair Trade Practices regulations and Takeover Code.
If you are working in the legal and compliance team or as a compliance officer, you have a thousand and one reasons why you should be aware of how to deal with SEBI and SAT, especially about the most contentious issues that lead to litigation. As the in-house counsel in such a company, you are in the best position to respond to show-cause notices, device policies or define strategy for defence and to lead any escalations on part of your organization. Whenever your company will get caught in some SAT litigation, you do not want to be blindsided, nor would you want to be at the mercy of outside counsel.
If you are working as an in-house counsel in a company which is growing fast and is on the way to an IPO, start preparing for this. You do not want to be caught off-guard. There are a host of securities legislations which start to become applicable to you as you move from the unlisted to the listed domain. You do not want to have the fear of waking up as a violator practically every day.
Further, SEBI can become active without prior warning and you may end up receiving a slew of show cause notices in connection with a securities acquisition or a trading practice.
The number and economic relevance of these cases increases for lawyers and compliance teams working with market intermediaries such as merchant bankers, portfolio managers, brokers, etc. Anyone working with corporate stock brokers or portfolio managers such as Motilal Oswal, Anand Rathi, Sharekhan, IIFL Securities will tell you about the extent to which the securities market intermediaries are regulated. Every move is required to be documented with precision.
There are frequent regulatory interactions which need to be adequately documented and corroborated with supporting evidence, else they will form the basis for an adverse legal action.
It needs a great degree of planning and preparation to install systems which ensure this compliance. Compliance officers of listed entities need to be on their toes to keep track of the applicable regulations, given that the amount of penalties that can be imposed by SEBI are far higher than say, penalties under the Companies Act, 2013.
As someone who will be advising your employer or your client, you will need to learn the skills not only to expertly deal with the litigation matters, but also to develop and install systems which can help to avoid litigation in the first place.
That is what we aim to deliver through this course, to lawyers who want to argue security law cases at the SAT as well as those who manage compliances and decide legal strategy from in-house legal teams or work in these areas at law firms.
In all cases where dealing in marketable securities is involved, there is movement of money. Often, a significant amount of money. Its fascinating to learn the many ways in which securities can exchange hands and how it can impact the market.
If you know how the transaction should be structured without ending up in litigation or regulatory obstacles, or if you know how to overcome such obstacles when they arise, there will be a lot of market participants willing to avail of your skills.
If you specialise in securities laws and SAT litigation, you would want to secure intermediaries of various natures in the securities market as your clients. When you consider the different kinds of intermediaries that operate in the securities market, this is not a small market at all. Wherever there is a move against a client by SEBI or the stock exchanges, you want to become the go-to person for them.
Listed entities would vie to get you into their legal teams, provided you have desirable skills in securities law and SAT litigation, since they need people who know the inside out of dealing with SEBI. You will be involved in all acquisitions, pledging and disposals of securities to advice on how SEBI regulations would impact or restrict such transactions.
As a SAT litigator, you can expect to get a holistic understanding of regulatory issues related to listed companies. Handling the briefs/matters of intermediaries, listed companies, SEBI etc will give you an in-depth understanding of the Securities market.
This is also why former SEBI legal officers are always in very high demand in the private sector.
- Regulators and bourses
- Stock brokers
- Portfolio management companies
- Merchant bankers
- Other securities market intermediaries
- In-house legal teams in listed entities
- Large conglomerates
- Law firms
- Corporate brokers
- Investment banks
- Portfolio managers
- Merchant bankers
- Other market intermediaries
- Compliance teams in corporations
- Stock exchanges
What is unique about this course
The course covers a hands on ‘how to’ element in every module – from the side of the participants in the securities market who are in interaction with SEBI and stock exchanges.
You will not learn the text of the regulations cover to cover – that is easily available on the SEBI website. What you will learn is how to use those concepts in SAT litigation matters, in your favour, whether you are an in-house counsel or a practitioner.
You will be asked to draft the actual documents which you would have to draft in a SAT litigation matter.
You will learn how to argue in SAT as an independent practitioner.
You will also be able to lead SEBI and SAT litigation for a company or a market intermediary if you are working in-house). This includes formulation of strategy, preparation of arguments, briefing arguing counsels or representing the organization yourself.
The course is tough and intensive, you will not be awarded the certificate unless you complete all the exercises. You have to spend 8-10 hours per week on this course.
You will get personal attention and coaching from the trainers, and get individual feedback on the quality of work you produce
Our trainers are highly experienced individuals with many years of industry experience
You will be writing an article every month and with our guidance publish the same either on iPleaders blog or various other industry publications
We will provide you a free course on professional networking, CV writing and interview skills so that you can easily find jobs
Those who perform well in class will be recommended to top law firms for internships and jobs. If you do not need such help, let us know in what other way we can help you.
You will find knowledge acquired in this course very valuable with respect to most teams at law firms, as an in-house counsel or even if you pursue corporate litigation.
- Commercial litigators
- Independent practitioners looking to build a tribunal litigation practice
- In-house counsels working in listed companies or with market intermediaries
- Corporate lawyers who are also handling commercial disputes work
- Compliance officers of listed entities
- Chartered Accountants and Company Secretaries who intend to represent clients and argue before SEBI and SAT
- Law students and lawyers looking to work in corporate law firms in commercial litigation team or in-house legal teams in entities regulated by SEBI
- Access to basic study material through online learning management system, android and iOS app
- Hard copy study material modules to be couriered to your address
- 2 practical exercises every week, followed by written feedback
- Based on the exercises, there will be a live video based online class. You can ask questions, share your screen, get personal feedback in this class.
- Classes are held after regular work hours. Typically classes are kept on Sunday afternoons or 8-9 pm on other days.
- You can ask questions, get your doubts cleared live as well as through online forums.
What will you learn
After completing this course, you will be able to advise your client on obligations under the takeover code, insider trading regulations, delisting regulations, unfair trade practices regulations and intermediaries regulations and how to install mechanisms for such compliance.
You will be able to confidently draft all responses to the communications from SEBI including show cause notices. You will know exactly how to structure these. You will get a thorough grasp of what kind of documents are required in the proceedings before the SEBI and and you will know how to draft these. You will know what goes on in a hearing before the Adjudicating Officer and be able to represent a client before the Adjudicating Officer.
You will also learn exactly how to draft appeals before the SAT in specific cases, how to present before the SAT and what are the practical aspects you should take care of, during a hearing. Someone who is appearing before the tribunal must be very thorough with the contents of the appeal which has been filed, since the judges can ask directly for where a specific aspect is referred to in the appeal or the application and you would normally be expected to answer within a matter of seconds. Someone who understands the case thoroughly can also frame summary or table of events for a quick reference of the judges so that the proceedings can progress fast.
Many sample documents have been provided in the course, which you can download and use for your day-to-day work.
Principal Learning Objectives
- Learn about how the interplay between SEBI, stock exchanges and the market participants works and how to use the interplay to your advantage in litigation;
- Learn what regulations will become applicable to you when you transition from an unlisted to a listed company and how to instal mechanisms to comply with these;
- Learn what goes on inside an acquirer entity and the legal department of the acquirer entity in the run up to the acquisition;
- Learn step by step how to deal with the compliance involved in the takeover of a listed entity;
- Learn how to draft a public announcement for an open offer, a detailed public statement and a letter of offer;
- Learn how to advise directors of acquiring or target entities about their liabilities under the takeover code;
- Learn how to identify an indirect or creeping acquisition;
- Learn how to secure an exemption from making a public announcement from SEBI;
- Learn how to plan the takeover actions in such a manner so to avoid any action from the regulators;
- Learn how to identify who can be considered insiders and what kind of information can be considered to be price sensitive information under the insider trading regulations;
- Learn how to comply with the requirements of pre clearance of trades, submission of trading plan and disclosures under the insider trading regulations;
- Learn how to draft a code for fair disclosures and a code of conduct under the insider trading regulations;
- Learn how to avoid the pitfalls such as social media posts which can result in a show cause notice from SEBI under the insider trading regulations;
- Learn what to do if you become aware of insider trading in your company;
- Learn what the unfair trade practices relating to the securities market are, how the market participants benefit from these and what are the consequences of engaging in unfair trade practices;
- Learn what to do if you become a victim to any unfair trade practice in the securities market;
- Learn what you should do if you are an intermediary and an investigation has been ordered against you by SEBI under the unfair trade practices regulations;
- Learn what compliance is required from you as an intermediary under the SEBI (Intermediaries) Regulations, 2008;
- Learn what to do if SEBI orders suspension or cancellation of your registration certificate as an intermediary;
- Learn how to delist your company from the stock exchanges;
- Learn what to do if your minimum public shareholding falls below the required level;
- Learn what to do if a stock exchange orders compulsory delisting of your securities;
- Learn how to draft and file a response against a show cause notice issued by SEBI;
- Learn how to appear in a hearing before the Adjudicating Officer / SEBI;
- Learn how to identify matters for which you can or cannot avail of a settlement with SEBI and matters for which it is not advisable to avail of a settlement;
- Learn how to arrive at a settlement and the procedure for completing a settlement;
- Learn the matters for which the Securities Appellate Tribunal does and does not have jurisdiction and how to use this knowledge to your advantage in litigation;
- Learn how to file a memorandum of appeal before the Securities Appellate Tribunal;
- Learn how to present in hearings before the Securities Appellate Tribunal;
- Learn how to file a rejoinder;
- Learn how to get yourself empanelled as a lawyer with SEBI / stock exchanges;
- Learn how to file a special leave petition to the Supreme Court against the orders of SEBI;
- Learn how to file a writ petition before the High Court under Article 226 of the Constitution of India.
Anand Narayan, Manager – Legal, Anand Rathi
Neha Koshy, Independent Lawyer, Delhi (Ex Associate – Cyril Amarchand Mangaldas)
Binoy Parikh, Chartered Accountant, Mumbai
Pranav Agarwal, Lawyer, (Ex Associate, Khaitan & Co.)
Abhyuday Agarwal, COO, LawSikho
List of Weekly Exercises
- How to identify the regulations which become applicable to you when you transition from an unlisted to listed company;
- How to identify whether a person is an acquirer and if the action constitutes an acquisition under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
- How to draft clauses of letter of offer under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
- How to advise clients on making voluntary and competing offers under the takeover code;
- How to identify eligibility to make a delisting offer and how to make the delisting offer;
- How to identify whether an exemption can be sought under takeover code and how to seek exemption;
- How to identify whether a person is an insider and whether the information is unpublished price sensitive information under the SEBI (Prohibition of Insider Trading) Regulations, 2015;
- How to draft a code for fair disclosures and a code of conduct under the SEBI (Prohibition of Insider Trading) Regulations, 2015
- How to identify whether an action constitutes a fraudulent or unfair trade practice under the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003;
- How to identify, based on a given situation, whether an action can be initiated by SEBI against an intermediary under the SEBI (Intermediaries) Regulations, 2008 against a stock broker/sub broker/portfolio manager;
- How to identify whether a company is eligible to delist its securities;
- Draft a board resolution/shareholder resolution / public announcement to delist;
- Draft a delisting application to a stock exchange;
- How to draft a reply to a Show Cause Notice issued by SEBI for a front running matter;
- How to draft a reply for a Show Cause Notice issued by SEBI for alleged insider trading violation;
- How to identify whether settlement can be availed of in a particular case and how to complete a consent form for settlement before SEBI;
- How to identify whether the Securities Appellate Tribunal has jurisdiction in respect of a specific matter;
- How to draft an appeal to be filed before the Securities Appellate Tribunal in respect of a matter relating to the unfair trade practices regulations;
- How to draft an appeal to be filed before the Securities Appellate Tribunal in respect of a matter relating to insider trading regulations;
- How to draft an appeal to be filed before the Securities Appellate Tribunal in respect of a matter under Takeover Code;
- How to draft an appeal to be filed before the Securities Appellate Tribunal against Stock Exchange decisions of delisting or refusal to list;
- How to draft an appeal to be filed before the Securities Appellate Tribunal against a debarment, suspension, cancellation or surrender order under the SEBI (Intermediaries) Regulations, 2008
- How to draft an appeal to be filed before the Securities Appellate Tribunal against the orders of the Insurance Regulatory and Development Authority;
- How to file an intervention application for hearings before the Securities Appellate Tribunal;
- How to file a Special Leave Petition before the Supreme Court under Article 136 of the constitution against orders of SAT;
- How to file a writ petition before the High Court under Article 226 / Article 32 of the Constitution of India.