Alerts

FSA Bans Short Selling in Financial Stocks and Requires Daily Short-Position Disclosures

September 19, 2008

On Thursday 18 September, the United Kingdom (“UK”) Financial Services Authority (“FSA”) amended its Code of Market Conduct to prohibit short selling in UK financial sector stocks and to impose daily disclosure requirements with respect to pre-existing short positions in such stocks. The ban goes into effect on 19 September and the disclosure requirement goes into effect on 23 September. The new rules apply to everyone and not just to UK regulated firms. Both the short-selling prohibition and the daily disclosure requirement are currently intended to cease to have effect on 16 January 2009. A comprehensive review of the rules relating to short selling is expected in January 2009.