CANADA: Entry into effect of new Canada short selling rules

Monday October 15 2012

Further to the update of 11th May, the amendments to the Universal Market Integrity Rules (UMIR) respecting regulation of Canada short selling rules and failed trades and dark liquidity have entered into effect.

These rules:

* repeal the tick test;

* impose pre-borrow requirements for short sales made in certain circumstances; and

* require a sell order from a short position to continue to be marked “short sale”;

but introduce a “short-marking exempt” designation to be used with an order for the purchase or sale of a security by certain accounts that adopt a “directionally neutral” strategy in the trading of securities.

Click on the above link for more details.