ABSTRACT
This chapter considers the theoretical basis for applying insider trading laws to corporations. This is done by considering the manner in which Australian insider trading laws apply to corporations and, in particular, whether a corporation is a ‘person’ caught by the prohibition of insider trading. While deficiencies and problems may be identified in the application of insider trading laws to corporations in Australia, such deficiencies and problems are unlikely to be rectified by simply importing the legal position adopted in another jurisdiction. Almost all countries with securities exchanges prohibit insider trading, there is no uniform application of such a prohibition to corporations. The original prohibition of insider trading under the State Securities Industry Acts focused on a ‘person-connection’ rather than an ‘information-connection’, with primary liability for insider trading depending on a person being ‘connected with a body corporate’.
