The Financial Services Authority has confirmed that its disclosure regime for significant net short positions in UK financial sector stocks is being extended indefinitely. The UK regulator said the disclosure regime, which was due to expire on 30 June, would be extended “without a time limit”.
This means that market participants will continue to be required to make disclosures when a net short position exceeds 0.25% of a company’s issued shared capital or increases by 0.1% bands above that (e.g. net short position reaches 0.35%, 0.45% etc).
The FSA said it does not intend to keep the regime permanently and is expected to make further announcements on short selling following an analysis of responses to its discussion paper (DP 09/1) on the options for a disclosure framework for all UK stocks.
The FSA first introduced its short-selling disclosure requirement on 18 September 2008 following the collapse of US investment bank Lehman Brothers.