Information on agreements / MoUs concerning the short-selling of US stocks - February 2023

We note your reference to Article 38 of the onshore Short Selling Regulation (UK SSR). Please note, however, that under Article 16 of the UK SSR, shares whose most liquid market is outside the UK are exempt from notification and cover requirements. Currently, a number of US stocks fall within this exemption.  For this reason, we do not normally receive net short position reports in US stocks unless they are principally traded in the UK. As per our most recent ‘List of Exempted shares’, there are over 2,500 US shares exempted, a complete list of which can be found here[1].

We have not entered into any memorandums of understanding specifically concerning the short selling of stocks, however, interactions on this issue could be covered by the following agreements, which also set out the type of information which may be shared:

1. Memorandum of Understanding dated 15 September 2010, between the Financial Industry Regulatory Authority (FINRA) and the Financial Services Authority (FSA)[2];
2. Memorandum of Understanding dated 25 September 1991, between the United States Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) and the United Kingdom Department of Trade and Industry and Securities and Investments Board (DTI)[3];
3. Amended Memorandum of Understanding dated 29 March 2019, between the United States Securities and Exchange Commission (SEC) and the United Kingdom Financial Services Authority (FSA)[3];
4. International Organization of Securities Commissions (IOSCO) Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information (to which the SEC and FCA are signatories) dated May 2012[4]. The date of formal signing can be found here[5];
5. Memorandum of Understanding dated 29 March 2019, between the United States Securities and Exchange Commission (SEC) and the United Kingdom Financial Conduct Authority (FCA)[6].