The Netherlands Authority for the Financial Markets (AFM) has decided to extend its measures against short selling until 28 February as a result of the continued exceptional market circumstances.
The AFM’s consultation with market parties and other experts has not provided a clear picture of whether it is desirable to extend the measures or to allow them to expire. Currently, other supervisory authorities in Europe have extended their measures against short selling, either unchanged or in an altered form.
Mr Bos, the Minister of Finance, has reported on discussions with market experts and academics in a letter to the Second Chamber of Parliament regarding the prohibition on short selling. He notes that there is a general understanding for the temporary measures, but that doubts exist regarding the usefulness of the measures in the long-term. However, there is conviction that the ongoing exceptional circumstances in the financial markets have made intervention by governments and supervisors unavoidable. At this juncture, Mr Bos sees no reason to take permanent, more drastic measures with regard to short selling after the extension of the current temporary measures.