Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Saturday, November 6, 2010

SEC Extends Compliance Date for Short-Sales Regulations

The SEC extended for a limited period of time the compliance date for the amendments to Rule 201 and Rule 200(g) of Regulation SHO . Rule 201 adopts a short sale-related circuit breaker that, if triggered, will impose a restriction on the prices at which securities may be sold short (“short sale price test restriction”). The amendments to Rule 200(g) provide that a broker-dealer may mark certain qualifying short sale orders “short exempt.”

The Commission is extending the compliance date to give certain exchanges additional time to modify their current procedures for conducting single-priced opening, reopening, and closing transactions for covered securities that have triggered Rule 201’s circuit breaker in a manner that is consistent with the goals and requirements of Rule 201. The extended compliance period will give industry participants additional time for programming and testing for compliance with the requirements of the Rule.

DATES: The effective date for Rule 201 (17 CFR 242.201) and Rule 200(g) (17 CFR 242.200(g)) remains March 10, 2010. The compliance date for both Rules has been extended from November 10, 2010 to February 28, 2011.

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That’s quite shocking news to hear, I think not many people were aware of this. This rule will result in less profit for the short sale people. It’s good to know that the dates have been extended till February 28, 2011. Thanks for sharing.

Posted by: Stuart | Dec 18, 2010 2:42:18 AM

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