Securities and Exchange Board of India, SEBI today approved stricter norms on insider trading, including new definition for connected people to prevent the menace. The new regulations strengthen legal and enforcement framework and also ensure that legitimate business transactions are not impacted. Insider trading refers to dealing in securities after having access to unpublished price sensitive information and such practices provide unfair advantage to the entity who has privy to such details. SEBI has expanded the definition of an Insider to include persons connected on the basis of being in any contractual, fiduciary or employment relationship that allows such people access to unpublished price sensitive information, UPSI. Under the new framework, SEBI has defined a connected person in the context of insider trading activities. A connected person would be someone, who is, or has during the past six months prior to the concerned act, been associated with a company, directly or indirectly. Besides, immediate relatives of connected persons would also come under the same category, unless they prove that they were not privy to unpublished price sensitive information. The onus of establishing that they were not in possession of UPSI would be with the connected persons. The new norms have revamped 20-year old regulations on insider trading.