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ARTICLE · 17 OCTOBER 2008

ASIC Bans Short Selling

Minter Ellison
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The Australian Securities and Investment Commission (ASIC) joined its US and European counterparts in announcing new measures in relation to short selling in an effort to restore investor confidence and maintain the fair and orderly operation of the market.

AustraliaFinance and Banking
Richard Batten
Richard Batten

The Australian Securities and Investment Commission (ASIC) joined its US and European counterparts in announcing new measures in relation to short selling in an effort to restore investor confidence and maintain the fair and orderly operation of the market.

The new measures were announced on 19 September 2008 in consultation and co-operation with the Australian Securities Exchange (ASX), and further clarified by ASIC on 21 September 2008. They apply from the opening of the market today, Monday 22 September 2008.

The measures, which have been described by ASIC Chairman Mr Tony D'Aloisio as 'circuit-breakers', include:

  • a ban on all naked short selling transactions
    From the opening of trading today, ASX will remove all securities from its Approved Short Sale Products List – the list of stocks approved for naked short selling. This means that the exemption afforded by s1020B(4)(e) of the Corporations Act 2001 (Cth) no longer applies.

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