On February 27, the UK Financial Services Authority (FSA) announced that it had prohibited short selling of the shares of four named Italian financial institutions for the duration of the February 27 trading day. The prohibition applied to all UK trading venues on which the shares are traded. The FSA stated that it had imposed the prohibition to assist the Commissione Nazionale per le Società e la Borsa (CONSOB), the Italian regulator, following the imposition by CONSOB of a similar one-day short selling ban.

The FSA and CONSOB prohibitions were imposed under emergency powers contained in Article 23 of the EU Short Selling Regulation (EU/236/2012) under which national regulators can impose temporary short selling prohibitions after a significant fall in the price of a financial instrument to prevent a further “disorderly decline” in that instrument’s price.

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