KOREAN REPUBLIC: Bill before parliament to amend Korea short selling rules

Thursday November 27 2014

Further to the update of 13 November 2013, the Korean securities regulator the FSC has announced that it will introduce disclosure rules for short-selling positions.

Under the current rules, individual investors are required to report their short positions to the supervisory authorities but these positions are not disclosed to the public. A bill on revisions to the Capital Markets Act is now pending in the National Assembly to introduce disclosure rules for short positions. Further details will be set out upon parliamentary approval for the revision.

The FSC’s previous announcement had indicated that short selling volumes in each stock would be published on a daily basis on the Korea Exchange website. They had also stated that investors whose short-selling position in a stock exceeds 0.5% of total shares would be required to disclose their position on the KRX website. Short positions which did not exceed KRW 100 million would be exempted from the disclosure requirement.

It is not clear at this stage whether these proposed changes will be approved.

Click on the above link for the press release.