Emergency Short Selling Restrictions in the Course of the Financial Crisis

Abstract

This paper summarizes the short selling restrictions adopted - mainly on an emergency basis - in the time period of July 2008 up to mid-June 2010 in 56 countries around the world. It is a supplement to a recent article of the authors (Gruenewald et al., 2010) and gives a detailed overview of the regulators’ short-term measures ranging from complete short selling bans to extra disclosure obligations for short sellers. The overview includes the measures’ time frame, type and exceptions as well as information on the targeted firms. Although not all countries have implemented short selling restrictions, their impact is massive: Approximately 80% of the December 2008 stock market capitalizations of the countries in our sample were directly or indirectly affected by some emergency short selling restriction.