In the last half century, few aspects of corporate life have been the subject of as much frenzied global debate and discourse amongst lawyers, economists, academics and bureaucrats as the law and practice relating to the regulation of insider dealing. 1 This is symptomatic of the underlying phenomenal emergence of the capital market as an undisputed catalyst for national and global economic growth in the modern world. The dynamism inherent in the operation of the market itself has led to the gradual disappearance of traditional distinctions between fi nancial institutions with the attendant opening up to competition of previously cartelized equity and bonds markets. 2
The dialectics between free market and centrally planned economy has long been settled in favour of the thesis propounding market forces as the means of achieving social and economic change and objectives. 3 The rapid innovations in the operations of securities markets have brought about changes that could cause problems for regulatory regimes through over-exposure and risk. This is further aggravated by the integration of computer power with modern communications systems, particularly the internet, which in turn allows securities houses a global fi eld of operations around the clock. Therefore, if the securities market is to perform effectively, its basic fundamental role as an arbitral allocator of scarce funds, the liquidity, transparency and
1 L Loss and J Seligman, Fundamentals of Securities Regulation (5th edn, Aspen Publishers, 2004); JC Coffe, J Seligman and HA Sale, Securities Regulation: Cases and Materials (10th edn, Foundation Press, 2007); BJ Davies, ‘Canadian and American Attitudes on Insider Trading’ (1975) 25 Univ of Toronto LJ 215-35, at 215.