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New CSSF Circular 12/548 published - 13/11/2012


On 31 October 2012, the CSSF published a press release and Circular CSSF 12/548 relating to the Short Selling Regulation (EU) 236/2012 (please refer to our previous news alert detailing the requirements), entering into force on 1 November 2012 and applicable to any natural or legal person involving in transactions providing short exposures on shares and/or EU sovereign debt. The circular sets out details on certain practical aspects of notification, disclosure and exemption procedures. In particular, the CSSF has developed a web-based platform to be used for notification and disclosure purposes when net short positions reach pre-defined thresholds. Please note that this notification can be delegated.

From an investment management perspective, the calculation of net short expositions should be performed for each individual fund or portfolio managed by the same management entity. Existing net short positions should then be aggregated whenever an individual fund or portfolio follows the same investment strategy towards a given issuer. In case of delegation, the management entity should only consider the positions it manages but not those which have been delegated (the third party will have to follow the same procedure). Different netting rules may apply within group of entities when dealing with non-management activities.

Each EU national competent authority is publishing their list of shares and sovereign debt issuers. In this respect, the CSSF is the competent authority for 25 share issuers and 4 sovereign debt issuers. When exceeding notification or disclosure thresholds at a given day, a notification to the CSSF or any other national competent authority must be done before 3:30 p.m. on the following trading day. Thresholds for all EU sovereign debt issuers and a list of exempt shares admitted to trading within the EU are available on the ESMA website. Therefore, the key operational challenge, apart from performing short selling exposures calculations, is to be able to file notification reports with each national competent authority concerned on due time.

With extensive experience in the outsourcing of reporting and regulatory expertise, Deloitte can help you to approach these new requirements.

Please do not hesitate to contact us should you need more assistance on these matters.

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Xavier Zaegel
Deloitte Luxembourg
Job Title:
Partner - Capital Markets/Financial Risk Leader
+352 451 452 748



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