FSA Temporary Prohibition on Short-Selling of Certain Italian Shares

On February 27, the FSA published a statement announcing an immediate temporary ban on the short selling of shares in four Italian companies – Banco Popolare, Mediolanum, Intesa and Banca Carige.  The prohibition was announced in light of a similar measure introduced by CONSOB, the Italian regulator, and following significant drops in the share price of the affected companies.  In explaining its decision to impose the ban, the FSA noted that the move was justified in order to prevent disorderly falls in the share price.

Leading up to the prohibition, the price movements in all four companies’ shares crossed one of the thresholds set out in the Short Selling Regulation  (Regulation 919/2012), which sets out criteria for determining a significant fall in price.