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ASIC announces requirements for disclosure and reporting of short sales from 19 November 2008
ASIC has announced new reporting arrangements for short selling which will come into effect when ASIC lifts its ban on covered short selling of non-financial stocks. ASIC expects to lift this ban from 19 November 2008.
The new arrangements will require trading participants:
- to inform ASX that they have advised their clients to disclose all short sales to them
- to determine and record whether a sell order from a client is a sale of securities they already own (Long Sale), a covered short sale (Short Sale) or a covered short sale which falls under one of the exemptions to the ban (Exempt Short)
- to report to ASX each business day all short sales, including Exempt Short sales in securities in financials for which the short selling ban remains in place and naked short sales that arise from the exercise of exchange-traded options. Initially this will be a daily report submitted by 9:00am capturing all short sales executed in the 24 hours up until 7:00pm on the relevant day
ASX will produce and disseminate a report to the market that will be released after 9:00am each trading day. The report will show, by security, the total volume of short sales executed on the previous trading day. The report will include Exempt Short sales in financial sector securities.
Obligations to report short sales that are otherwise allowable under sub-section 1020B(4) of the Corporations Act 2001 are unchanged.
ASX has initiated system changes to automate the receipt of short sale information. When these changes are complete, trading participants will be able to dispense with the end of day reports to ASX. Instead, ASX will aggregate data received from the real-time tagging of orders to produce the report released after 9:00am on the next trading day.
For more information, see ASIC’s media release:www.asic.gov.au