Newsletter for primary market participants.
November 2025 / No. 60
CP25/29: Consultation Paper on changes to the UK short selling regime
On 28 October 2025, we published a Consultation Paper (CP25/29) proposing changes to the UK short selling regime. This is part of the process to repeal and replace assimilated EU law. We are proposing to create a new Short Selling Sourcebook, sitting within the FCA Handbook, containing our rules and guidance on short selling activity.
Our CP supports and implements the changes made by the Treasury in the UK Short Selling Regulations 2025 (SSR 2025). These were published in January 2025 to establish a new legislative framework for the regulation of short selling. The SSR 2025 introduced changes to aggregate the public disclosure of net short positions and to remove UK sovereign debt and UK sovereign debt credit default swaps from the general scope of the new regime.
Collectively, our proposals intend to support growth through the creation of a more efficient, effective and coherent regulatory framework. We do not intend to fundamentally change the current regime.
Instead, we aim to remove unnecessary and disproportionate requirements, which may inhibit or discourage short selling that supports liquidity. Our proposals also intend to improve pricing, and facilitate risk management, while still making sure any risks are sufficiently managed.
1. Our proposals
The key proposals in our CP affect the following areas:
- Position reporting: We propose to extend the deadline for reporting net short positions (NSPs) to 23:29 on T+1. We propose additional guidance on the calculation of NSPs and how a company’s issued share capital can be determined.
- Covering: We are proposing that records demonstrating appropriate covering agreements and arrangements are held for a minimum period of 5 years.
- Reportable Shares List: We are proposing a new list of admitted shares to which our reporting and covering rules apply. This will replace the current list of admitted shares that are exempt from our rules.
- Market Maker Exemptions: We propose to simplify the notification process and reduce the period of time, prior to using the exemption, that market makers are required to submit notifications.
- Aggregated Net Short Position Disclosures: The SSR 2025 requires us to combine and publish the NSPs reported to us as aggregate net short positions (ANSPs) in relation to each company. NSPs reported by individual position holders will be anonymised. We are also proposing to issue new guidance on how we calculate, publish, update and correct the list of ANSPs we disclose.
In addition, we are consulting on a Statement of Policy explaining the circumstances where we may exercise our emergency powers. We are proposing to maintain our current high bar for using our emergency powers.
2. Derivation and Changes Table
To accompany our CP and to further support firms’ understanding of our new proposals, we have separately published a Derivation and Changes Table. This details how we have transferred rules and guidance from the UK SSR, relevant Commission Delegated Regulation, Technical Standards, ESMA Guidelines and ESMA Q&A into our new Short Selling Sourcebook within the FCA Handbook.
3. Industry event on our proposals
On 6 November 2025, we hosted an industry event to walk through the key proposals in our CP, as well as the operational changes. We were delighted to see so many firms attend in person and were grateful for your contributions.
We have published some of the materials discussed in the event on the updated consultation paper page.
4. Your feedback
We would like to hear your views. Our CP (including our Derivations and Changes Table) is open for feedback until 16 December 2025. Please respond by completing the online response form, or by sending a response to [email protected].