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Bailey McCann, Opalesque New York: The European Securities and Markets Authority (ESMA) has provided a new question and answer document online as guidance concerning short selling rules in the eurozone. The Regulation places new restrictions on short sales of securities traded in EU markets and EU sovereign debt, including credit default swaps ("CDS") that are referable to EU sovereign debt, as well as requiring certain private and public disclosures.

According to the document, "the objectives of this short selling legislative framework are to increase transparency of short positions held by investors in certain EU securities, reduce settlement and other risks linked with uncovered or naked short selling and create a harmo- nised framework for coordinated action at European level." In a client alert from law firm Shulte Roth & Zable, financial attorneys note that the document provides much needed clarity on the scope and disclosure responsibilities surrounding these rules.

According to the authors of the alert, new EU short selling rules can be expected to have a fairly far reaching scope, specifically - "the mere fact that a particular instrument is admitted for trading on......................

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