New Frontiers of Insider Dealing Regulation in Zambia — Towards a Level Playing Field

Insider dealing involves the monopolistic enjoyment, by corporate insiders, of private rents from property rights locked up in the unpublished price-sensitive corporate information. This article examines the Zambian legal, regulatory and institutional framework for public distribution of securities so as to determine whether or not is provides adequate incentives for effective public distribution of private rents from non-public material corporate information. The article argues that the limiting of civil recovery to director-insider-dealing, the non-distribution of disgorged funds to injured investors, and the poor institutional enforcement capacity of the Zambian SEC, are likely to compromise the effective distribution of private rents from unpublished price-sensitive corporate information between corporate insiders and outsiders. The article has demonstrated that, in Zambia, public distribution of private rents from non-public material corporate information could be enhanced by: i) extending civil recovery to other forms of insider dealing than director-insider-dealing; ii) enhancing the institutional enforcement capacity of the Zambian SEC; iii) distributing disgorged funds to investors who suffer pecuniary loss as a result of insider dealing.