On 24 April 2026, UK FCA issued Handbook Notice 140 which also contains the Short Selling Rules Sourcebook Instrument 2026 (FCA 2026/16), first issued 16 April 2026.
Background:
- From 13 July 2026, existing exemptions for market making in UK sovereign debt will no longer apply, but FCA's emergency powers will continue to cover these instruments.
- Deadline for reporting net short positions is extended to 23.59 T+1, and there is new guidance on the provision of issued share capital, group-level reporting arrangements, and updates to the relevant notification templates.
- Requirement for firms to keep records of their covering arrangements for 5 years.
- A new reportable shares list will replace list of exempt shares and set out the shares, admitted to trading on UK trading venues, that are subject to short selling rules.
- FCA has issued test copy of the reportable shares list in in CSV and XLSX formats.
- Notification process for market maker exemptions is streamlined, notification will become activity-based, market makers will have to provide an annual attestation.
- Transitional provisions require market makers to renotify FCA of existing exemptions.
- From Jul. 13, 2026, FCA will publish aggregate net short positions (ANSPs) by company, aggregating the individual net short positions reported at or above the 0.2% threshold without identifying individual position holders.
- FCA retains emergency powers to prohibit, restrict, and impose additional requirements on short selling in exceptional circumstances, sets a high bar of use of these powers, which it would only consider using in exceptional market conditions.
