ESMA Guidelines and Recommendations

ESMA issues positive opinion on short selling ban by Italian CONSOB

ESMA Guidelines and Recommendations

Date: 25 November 2016

On 4 October 2016, the European Securities and Markets Authority (ESMA) issued an opinion agreeing to extending an emergency short selling prohibition, for a period of 90 calendar days, by the Commissione Nazionale per le Società e la Borsa (CONSOB) on net short positions in Banca Monte dei Pascha di Siena spa (BMPS) shares under the Short Selling Regulation.

The measure is expected to enter into force at 00:00:01 CEST on 6 October 2016 and will remain in place until 24:00:00 (CET) on 5 January 2017. It temporarily prohibits transactions in any shares, either directly or through related instruments and irrespectively of the venue or market in which the transactions leading to those positions are conducted. The measure does not apply to trading in index-related instruments.

The short selling measure applies to any natural or legal person, irrespective of their country of residence, and does not exempt market making activities.

ESMA considers that the current circumstances related to BMPS constitute adverse events or developments which constitute a serious threat to market confidence in Italy and that the proposed measure is appropriate and proportionate to address the threat to Italian financial markets.