Protecting Companies, Directors, Senior Officers and Employees Written by Glenn Hamel‘Smith and Melissa Inglefield in the Act for any information disclosed by Connected person in the necessary course business", large accounting firm in Trinidad ‘ob is one of many employees in a ib innocentiy decides Breaching such restrictions constitutes at shares ‘publicly listed compar Seer fe on summary cor 000,000 and to ingabn Connected persons ard companies lating a merger | the stock exchange aso have certain report between BigCompanyX and a third-party entity. Within days, the merger i announced and BigCompanyx's st shoots up. The next thing Bob kn‘ that he is the subject of an invest However, the defences and exceptions do ot provide @ safe haven in which connected parties are able to trade without any risk of breaching the lan. Allegations of market ‘conduct are a provisions seek to regulate. INSIDER TRADING ' connected person may RESTRICTIONS ie was not in pos Under the Securities Ac, connected persons} of material non-public information at te that (she cared out a trede, REDUCING THE RISK Ifyou area connected person to a reporting the obvious recommendation to ens W avoid breaching te restrictions in the ‘Acts both not to trade when in possession ‘of material non-public irformation and not ron-public information tats not inthe public domainINSIDER TRADING (continued) you take into account that mést senior officers majority shareholders and other persons it 2 position of trust Connected persons and public companies and their affiliated companies should ensure that due {which may not yet be inthe public dom F or example, a pt regulatory matter. Legal advice should also be sought to ensure that the necessary policies and controls are introduced and implemented to reduce the risk of jing the subject of an ‘nother mechanism thet may be considered by public companies ‘ware ofthe up to date financial results of the ccampany. When, then, can such 2 perso trade? In ight of the difeuity that cirectors and } polices and procedures may be targeted towards: + Identifying persons ishment ofa tracing plan by acomected rd cross badteeniy esting ie stent objectives, his or her appetite for isk, and certain parameters within which the broker may trade. in instances where one of the objectives ofthe pln is to mitigate the ri 30 serior officers and employees repercing the cme of nsder trading and ‘oping oF, Implementing preau jon oF post- ‘trades by senior aflers and emph ing trading windows or b ‘during which senior office ‘Where the regulator can demonstrate in either case that the chenge was made or the trade , merely implementing 2 policy ie above matters would not be public company must be sure and exercise careful discretion when dealing the stock market with the shares of companies ‘to which they are conrected,LEARNING FROM BOB $0 what about 805? Bob Is clearly 2 connected person to BigcompanyX ash ng fim providing ial services to BigCompanyX, AS to Meer on a useful means of ensuring that your investment portfolio One te without)the risk of 1e may be exposed to the discomfort of being the subject of such an companies and. their should ensure that due cares pai regulatory matter Legal advice Prot Alce Deon