EUROPE: ESMA publishes revised list of thresholds for sovereign debt for EU short selling

Wednesday November 4 2015

The European Securities and Markets Authority has published revised debt for sovereign debt issuers.

According to Article 7(2) of the Short Selling Regulation, ESMA has to publish a list of the thresholds applicable to the sovereign issuers for the purpose of the notification to competent authorities of significant net short position in sovereign debt.

Initial threshold categories shall be:
0.1% applicable where the total amount of outstanding issued sovereign debt is between 0 and 500 billion euros;
0.5% applicable where the total amount of outstanding issued sovereign debt is above 500 billion euros or where there is a liquid futures market for the particular sovereign debt.

The additional incremental levels shall be set at 50% of the initial thresholds. The reporting thresholds shall be monetary amounts fixed by applying the percentage thresholds to the outstanding sovereign debt of the sovereign issuer. They will be revised and updated quarterly to reflect changes in the total amount of outstanding sovereign debt of each sovereign issuer.

The figures of the amount of outstanding debt are duration adjusted (not nominal amounts) and are approximations provided by competent authorities.

Click on the above link for the revised thresholds.