On Friday, September 19, 2008, the Securities and Exchange Commission announced a trifecta of emergency orders that will remain in effect through October 2, 2008. The orders:
- impose a temporary emergency ban on short selling the securities of 799 financial services companies (http://www.sec.gov/rules/other/2008/34-58592.pdf);
- require certain institutional investment managers to report on new Form SH their short sales of other publicly traded equity securities that are effected on or after Monday, September 22 (http://www.sec.gov/rules/other/2008/34-58591.pdf); and
- temporarily alter timing and volume conditions in order to expand the safe harbor in Rule 10b-18 to companies repurchasing their own shares (http://www.sec.gov/rules/other/2008/34-58588.pdf).
This SecMail Alert describes the orders and provides some preliminary reactions as to their implications for market participants.
For more information on this subject matter, please see our Client Memorandum"SEC Issues Emergency Ban on Short Selling of Financial Stocks, Requires Reports of Short Sale Activities in Other Stocks and Temporarily Relieves Restrictions on Corporate Buy-Back Programs."
