GREECE: HCMC responds to enquiry concerning prohibition of covered Greece short selling and disclosure regime

Wednesday August 10 2011

The Hellenic Capital Markets Commission have answered a number of questions regarding the recent prohibition of covered Greece short selling and the effect on the disclosure regime and other measures previously applicable to covered short sales. The prohibition extends from 9 August to 7 October 2011. The questions and answers submitted are as follows:

“Do the disclosure provisions continue to apply to existing covered short positions?

Yes, the disclosure provisions for large short positions are still applied.

Do the provision on flagging, up-tick and disclosure continue to apply to obtaining or increasing short exposure through listed or OTC derivatives, which are permitted exceptions to the new rules on prohibition?

Since the short selling is prohibited, no short sell order can be entered to the ATHEX cash market, hence neither flagging nor up-tick can be applied, as no short sell order can be entered.

In that framework, a short position can be increased only by using derivatives.

Must existing covered short positions, which would now be prohibited under the new short selling rules, be “closed out” within a certain timeframe?

No, there is no provision to close out any short positions within a certain timeframe.”