The Minister for Financial Services, Superannuation and Corporate Law, Chris Bowen MP, has released draft regulations and commentary material in relation to the disclosure of short selling information under the Corporations Amendment (Short Selling) Act.
The new regulations maintain the existing requirement for sellers to advise the broker when placing an order for a short sale, for the broker to advise the ASX of all short sales transacted for each stock the same day, and for the ASX to publish the information by 0930 the following morning. This will be known as Transactional Reporting which has previously been criticised for not showing net short positions.
Added to this will be a new level of reporting to be known as Positional Reporting, to come into effect on 1 April 2010. Under this regulation each seller will be required to advise ASIC of each short position they hold within three days of taking that position, and each day thereafter that the position remains short. ASIC will in turn aggregate this information and publish net short positions the following morning.
The Minister has called for submissions from interested parties on the new regulations, with a closing date of Friday 23rd October.
