Alerts

UK FSA Rule on Short Selling in Rights Issues, Effective 20 June 2008

June 16, 2008

The UK Financial Services Authority (FSA) announced on Friday that effective Friday 20 June 2008, new provisions will be introduced into the Code of Market Conduct which will require disclosure of significant short positions in stocks admitted to trading on prescribed markets which are undertaking rights issues. Significant short positions are defined as 0.25% of the issued shares. Instruments giving rise to an equivalent economic interest as a short sale should be aggregated with short sales in determining whether there is a disclosable short sale. Failure to disclose a significant short position will constitute behaviour that amounts to market abuse (either as misleading behaviour or distortion of market). Disclosure will be required to be made by means of a Regulatory Information Service by 3:30 pm the following business day.