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FSA Temporary Prohibition on Short-Selling of Certain Italian Shares

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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.

New Temporary Short Selling Bans Introduced by Spain, Italy and Greece

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On July 23, Spain, Italy and Greece introduced new temporary bans in relation to short selling in response to the recent extreme volatility in the European financial markets.

The Comisiòn Nacional del Mercado de Valores (“CNMV”) has decided to ban short selling on Spanish regulated markets with immediate effect. The ban will apply for three months until October 23, although CNMV may choose to extend it for a further period.

The Commissione Nazionale per le Società e la Borsa (“CONSOB”) announced a ban on short selling in respect of shares of certain companies in the Italian banking and insurance sectors that will last from July 23 to July 27.

In addition, on July 24, Greece’s Hellenic Capital Market Commission (“HCMC”) announced an extension to the current short selling prohibition on the Athens Stock Exchange for an additional three months until October 31. Press Release.

For further details, please see updated version of the European Securities and Markets Authority (“ESMA”)’s table of members’ short selling measures. Updated Version.