New Short Sale Reporting Requirements
September 22, 2008
Under an SEC Emergency Order effective today, all institutional investment managers that are Form 13F filers for the calendar quarter ended June 30, 2008, will be required to file each week a Form SH reporting any short sale activity in Section 13(f) securities in the preceding seven calendar days. The Form SH must be filed electronically on the EDGAR system on a non-public basis but will become publicly available two weeks after the required date of filing.
The first report must be filed on Monday, September 29, 2008, by 5:30 p.m. Eastern time and must include, with respect to each calendar day in the preceding week:
Thereafter, reports must be filed by 5:30 p.m. Eastern time on the first business day of every calendar week immediately following a week in which the manager effected short sales. The Form SH reporting requirement is set to expire on October 2, 2008, but may be further extended by the SEC, provided that the total duration of the requirement does not exceed 30 calendar days.
Additional details regarding the new short position reporting requirements include:
For a separate analysis and discussion of the SEC ban on short sales of financial companies, see Davis Polk Client Newsflash SEC Amends Order Temporarily Banning Short Sales of Financial Companies to Modify Scope of Covered Securities and Expand Exemption for Derivatives Market Makers.
If you have any questions regarding this newsflash, please call your Davis Polk contact.
1. Specifically, the Emergency Order applies to any institutional investment manager that exercises investment discretion (as defined in Rule 13f-1(b) of the Exchange Act) with respect to accounts holding Section 13(f) securities (as defined in Rule 13f-1(c) of the Exchange Act) having an aggregate fair market value on the last trading day of any month of any calendar year of at least $100,000,000.
2. Form SH filers must label each form as non-public by adding the phrase “NON-PUBLIC” (in bold and capital letters) at the top and bottom of each page of the entire form, including each page(s) of the Cover Page, Summary Page and Information Table. The Emergency Order expressly states that no procedure for seeking confidential treatment of information shall apply to information filed or transmitted to the SEC in compliance therewith.