The Netherlands Authority for the Financial Markets (AFM) published a draft policy rule regarding the definition and calculation of a short position as described in the Financial Supervision Act (Wft) on 19 March 2013. The results of the consultation and the policy rule itself can be downloaded using the link alongside this article.
A legislative change takes effect on 1 July 2013 whereby the first threshold is reduced from five per cent to three per cent, and the notification of short positions is introduced in Section 5.3 Wft. This notification requirement will apply in addition to the notification requirement of a net short position under the Short Selling Regulation.
In the debate of the bill in the Dutch House of Representatives, the Minister of Finance was asked whether further clarification regarding the definition of a short position and how this should be calculated could be provided in a further policy rule or decree. The Minister agreed to provide further clarification by establishing further regulations at a later date. This policy rule contains this further clarification.
Information on the reduction of the threshold to three per cent and the notification of short positions will also be included in the amended Guideline for Shareholders in due course.
The feedback statement (Dutch language) and the policy rule can be downloaded in PDF format using the link alongside.
The AFM is committed to promoting fair and transparent financial markets.
As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.