According to the market regulator, reversal trades occur when entities reverse their trades with the same counterparties on the same day at a significant price difference without a significant basis for the change in the contract price. This suggests that the trades are not genuine and artificial.
The Securities and Exchange Board of India (Sebi) has introduced the Illiquid Stock Options (ISO) Scheme, 2024, for companies who have participated in the Bombay Stock Exchange (BSE)’s ISO segment and are facing legal action. The program will start on March 11, 2024, and last through May 20, 2024 (both days included), or until another date that has been authorized.
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The public notice published on March 6, stated, “The Scheme would provide a settlement opportunity to all the entities that have executed reversal trades in the stock options in the period between April 01, 2014, and September 30, 2015, against whom proceedings have been initiated and are pending before any authority or forum, viz. Adjudicating Officer/ the Hon’ble Securities Appellate Tribunal (SAT)/ Hon’ble Courts/ Recovery Officer (provided an appeal has been filed and the same is pending before the Hon’ble SAT/Court).”
It continued, “By availing the benefit of the scheme, the entities may settle such proceedings and avoid further delay in the conclusion of the said proceedings and the associated long-drawn legal processes/ expenses, etc.”
