Short-Selling - FSA´s Proposal For A Permanent Regime

On 6 February 2009, FSA published its long awaited discussion paper on a proposed permanent regime to regulate short selling in the UK.

In response to the severe falls in the share prices of financial institutions in September last year, FSA introduced, without consultation, a set of temporary emergency measures in relation to short selling which was perceived to be partly responsible for these falls (to read our previous Law Now on these measures please click here). The measures taken at that time were:

• a purported ban on holding any new net short position in respect of stocks in certain prescribed financial institutions; and
• disclosure of any significant existing net short positions in the same institutions.