Stand:updated on 11.02.2025 | Topic Short selling Regulation of short selling and certain aspects of credit default swaps
In Europe, the rules regarding short selling are set out in Regulation (EU) No 236/2012 on short selling and certain aspects of credit default swaps (EU Short Selling Regulation), and in five regulations governing implementation.
The following five regulations clarify the provisions of the EU Short Selling Regulation:
- Delegated Regulation (EU) No 918/2012 inter alia with regard to definitions,
- Implementing Regulation (EU) No 827/2012 laying down implementing technical standards,
- Delegated Regulation (EU) No 826/2012 with regard to regulatory technical standards,
- Delegated Regulation (EU) No 919/2012 also with regard to regulatory technical standards,
- Delegated Regulation (EU) 2022/27 as regards the adjustment of the relevant threshold for the notification of significant net short positions in shares.
The European Short Selling Regulation is essentially based on two pillars:
- Prohibiting provisions for uncovered short sales in shares and sovereign debt as well as uncovered sovereign credit default swaps (Articles 12 et seq. of the EU Short Selling Regulation),
- Transparency provisions for net short positions in shares, sovereign debt and, where applicable, credit default swaps (Articles 5 et seq. of the EU Short Selling Regulation).
The provisions of the EU Short Selling Regulation are also applicable outside the EU and to natural or legal persons from third countries. In this regard it does not matter where the transaction in question is concluded nor what nationality the involved parties have nor where they have their registered office.
Exemptions from both the prohibitions and the transparency requirements are provided for the activities of market makers and primary dealers.
Contact
If you have any further questions that are not answered by the FAQ please contact us by short-selling@bafin.de.
Please send any disclosures about actual or suspected violations of supervisory provisions to our contact point for whistleblowers.
