- FI continually requests that the banks and other financial market participants submit statistics on share loans.
- FI has increased its focus on market surveillance of trading in financial companies. Suspected market manipulations are immediately reported to the Swedish National Economic Crimes Bureau.
- FI compiles statistics on the settlement quality of securities transactions from the Swedish Securities Register Centre.
A ban on short selling in Sweden would probably require legislative changes. At the present time, Finansinspektionen sees no reason to limit short selling.
Using short selling to unlawfully influence the price of a security is already prohibited today through the regulation contained in the Financial Instruments Trading (Market Abuse Penalties) Act (SFS 2005:377).
Short selling normally refers to when someone sells shares or other securities which have been borrowed from someone else. For this loan, the person pays a fee and assumes the responsibility to return the shares. The purpose of short selling can be to protect one's portfolio, but is often for speculating on a decline in the short sold shares. Because it is a matter of a securities loan, the person is obligated to return the borrowed shares, most often at a predetermined time. This means that those who short sell a share sooner or later must buy back the same shares for the purpose of returning them to the owner.
