On February 24, the UK’s Financial Conduct Authority (FCA) announced a change to the process firms should use to report short positions in UK-listed financial instruments under the Short Selling Regulation 2012 (SSR). The change was announced on an updated webpage, available here.

Previously, firms could report short positions to the FCA by submitting a notification form via email. Now, firms have to submit that notification through an online portal called ESS, and therefore must have an ESS account prior to filing any SSR reports.

Each notification form will need to be accompanied by an authorization letter. This letter, prepared on the firm’s letter head, should state which individuals have permission to submit notifications on behalf of the firm, and should be signed by an individual who has the authority to give that permission.

The thresholds for short selling reporting have not changed. For equities admitted to trading on a UK or EU trading venue, a private disclosure to the regulator must be made when the net short position reaches 0.2 percent of the issued share capital of the company, and for each incremental 0.1 percent change thereafter.

A public disclosure (which is published on the FCA’s website) must be made when the net short position reaches 0.5 percent and for every 0.1 percent increment thereafter. Certain shares are exempt if the principal trading venue is located in a third country, as listed here.

The thresholds for net short positions in sovereign debt and positions in uncovered sovereign credit default swaps vary depending on the issuer, and are set out in a spreadsheet maintained by the European Securities and Markets Authority (ESMA) here. The SSR does not apply to corporate debt.