That investment was a 9.99% stake Jio Platforms, the digital technology arm of Reliance Industries, which also owns Reliance Jio, the 4G-only mobile operator.
Reliance Industries, led by Mukesh Ambani (pictured), did not comment.
The fine, totalling 3 million Indian rupees, is hardly going to cause anybody any pain. That sum is equivalent to $38,286 at today’s exchange rate – just 0.0007% of the amount Facebook – now Meta – invested in Jio.
Reliance and two of its staff, named by the regulator as Savithri Parekh and K Sethuraman, all have to pay the same amount in the next 45 days.
The regulator, the Securities and Exchange Board of India (Sebi), complained that news of the investment emerged in newspaper reports, not via an official announcement by Reliance Industries.
Sebi adjudicating officer Barnali Mukherjee said that the news about the deal emerged on 24-25 March 2020, “and the information to the stock exchanges about the media release titled ‘Facebook to invest Rs 43,574 crore in Jio Platforms for a 9.99 per cent stake’ was made on April 22, 2020, ie, after 28 days and this calls for an appropriate penalty.”
The regulator said that Reliance should have clarified the information as soon as it appeared in the media – a principle called “fair disclosure of unpublished price sensitive information”, which means the company should have made the information generally available.
The Financial Times was first to break the news, on 24 March 2020, citing people “with knowledge of the discussions”. Capacity followed up the report the same day.
