We have finalised our new rules and guidance for short selling activity.
In this Policy Statement (PS26/5), we summarise and respond to the feedback received on our proposals in CP25/29: Changes to the UK Short Selling Regime[1]. It includes our final short selling rules, Statement of Policy on the use of our emergency powers, and operational details on how and when our new rules will come into force.
Our final rules implement the changes made in the Short Selling Regulations 2025 (SSR 2025)[4], and make further changes to create a more efficient, effective, and coherent short selling regime to maintain the orderly and effective functioning of UK markets, while removing disproportionate costs.
We are creating a new Sourcebook for our short selling rules, within the FCA Handbook, to largely replicate existing provisions from the current regime. In addition, our final rules make changes in the following areas:
UK sovereign credit default swaps (CDS) are outside the scope of position reporting and covering requirements.
From 13 July 2026, existing exemptions for market making in UK sovereign debt will no longer apply. However, our emergency powers will continue to cover these financial instruments.
We are extending the deadline for reporting net short positions to 23.59 T+1. We are also issuing new guidance on the provision of issued share capital, group‑level reporting arrangements, and updates to the notification templates. See PS26/5 page 11[5].
We are formalising the requirement for firms to keep records of their covering arrangements for 5 years. See PS26/5 page 23[6].
A new reportable shares list will replace the list of exempt shares and set out the shares, admitted to trading on UK trading venues, that are subject to the short selling rules.
For issuers with multiple classes of shares admitted to trading, the reportable shares list will identify the main class of ordinary shares for the purpose of reporting.
To support firms’ preparation, we’ve published a test copy of the reportable shares list in CSV[7] and XLSX[8] formats. See PS26/5 page 27[9].
We are streamlining the notification process for market maker exemptions. The notification will become activity-based, removing the requirement for market makers to send further notifications to add financial instruments to their exemption.
Market makers will instead be required to provide an annual attestation.
Transitional provisions also require market makers to renotify us of their existing exemptions. See PS26/5 page 34[10].
From 13 July 2026, we’ll publish ANSPs by company, aggregating the individual net short positions reported at or above the 0.2% threshold without identifying individual position holders. See PS26/5 page 43[11].
We retain emergency powers to prohibit, restrict, and impose additional requirements on short selling in exceptional circumstances.
We set a high bar for the use of our emergency powers, which we would only consider using in exceptional market conditions.
Our Statement of Policy details the circumstances under which we may exercise our powers. See PS26/5 page 59[12].
PS26/5, our final short selling rules, and the Statement of Policy, will interest:
Our short selling rules came into force on Monday 13 July 2026.
To allow sufficient time to implement the new regime alongside operational changes, we are implementing in 2 phases:
Phase 1 was implemented on the main commencement day, Monday 13 July 2026. This included:
Phase 2 will take effect on Monday 30 November 2026. This includes:
We have produced an ‘operational guide[3]’ to provide more detailed information on the operational changes required and the timeframe for implementation.
The UK Short Selling Regulation (UK SSR)[13] is assimilated EU law, incorporated into UK law by the European Union (Withdrawal Act) 2018[14]. This forms the basis of the UK short selling regime.
The UK SSR sets out requirements for short selling activity in financial instruments admitted to trading on UK trading venues. This includes shares, UK sovereign debt, and UK sovereign CDS.
The Financial Services and Markets Act 2023[15] sets out the legal framework for repealing and replacing assimilated law. As part of this process, the Treasury made the SSR 2025, in January 2025, to establish a new legislative framework for the regulation of short selling. This gave us rulemaking, supervisory, and enforcement powers. It also broadly replicates our current emergency powers.
Our proposals in CP25/29 were based on feedback from the Treasury’s Short Selling Regulation: Call for Evidence[16]. This concluded that it wasn’t necessary to fundamentally change the current short selling regime, although it should be modified to remove disproportionate burdens, on firms, that may inhibit or discourage short selling and its associated benefits.
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