Regulatory Alerts2020-04-15
ESMA Opinion on FSMA Emergency Short Selling Measure under the SSR
The European Securities and Markets Authority (ESMA) issued an opinion endorsing the Belgian Financial Securities and Markets Authority’s (FSMA) one-month extension of a temporary ban on short selling and net short positions for Belgian equities and related instruments. ESMA concurred that the measure is necessary and proportionate to counter severe market volatility, downward price spirals, and disinformation triggered by the ongoing COVID-19 pandemic, which poses a serious threat to market confidence and financial stability in Belgium. The renewed prohibition, effective from 17 April to 18 May 2020, includes targeted exemptions for market makers, index and basket instruments, convertible bonds, and subscription rights to preserve market liquidity while mitigating systemic risks.