An Overview of Insider Trading Law and Policy : An Introduction to the Insider Trading Research Handbook

This essay will serve as the introduction to a collection of 23 newly commissioned articles on numerous aspects of insider trading law. The contributors cover a wide variety of topics, ranging from analyses of current issues in USA insider trading law, empirical analyses of insider trading both in the USA and around the globe, and global perspectives from China, Japan, Australia and New Zealand, Europe, and the UK. Insider trading jurisprudence is strongly skewed towards US law. This emphasis is not mere academic parochialism or chauvinism, however. The USA remains the world's largest capital market. More important for present purposes, the USA was one of the first jurisdictions to ban insider trading and remains the jurisdiction in which the ban is most energetically enforced. To be sure, insider-trading bans are now on the books in many jurisdictions and there is growing global emphasis on fighting the practice. A number of the papers in this volume focus on these developments. Much of the volume nevertheless is appropriately devoted to US law. The long history and highly developed body of US law on the subject suggest that studying the legal doctrine and policy underpinnings of the U.S. prohibition of insider trading will reward study not only for US corporate and securities law scholars, but those of all countries. Accordingly, this introduction provides a foundation for the papers that follow by setting out the basic US legal rules and the policy debate those rules have engendered