Marking Of Short Sell Orders

To further enhance transparency of market activities, SGX will from 11 March 2013 require marking of short sell orders on its securities markets. Please refer to the Guidelines on Short Selling Disclosure issued by the MAS on 9 January 2013. Short selling in respect of securities is the sale of securities that the seller does not own at the time of sale.

(1) All online clients are expected to accurately disclose the nature of their sell orders based on what they know about their positions at the time of order entry.

An example is set out below:

(a) An investor holds 5,000 shares of Stock A. He puts in a sell order for 5,000 shares of Stock A. This is a normal sell order. He also puts in a buy order for 3,000 shares of Stock A.

(b) Subsequently he enters a sell order for 3,000 shares of Stock A. At the point where he enters the sell order, the buy order for 3,000 shares of Stock A has not been filled. The investor should mark this sell order as a Short Sell Order.

Clients are also required to split partial short orders, where he does not own the full quantity of securities to be sold, into two separate orders. One order is for the portion he owns (i.e., normal sell order) and the other for the portion that he does not (i.e., Short Sell Order).

(2) Clients who place their orders through their Trading Representatives are required to indicate whether their orders are 'Short' or otherwise when placing orders.

If you subsequently discover that you have wrongly marked the sell order which have been executed, please contact your TR no later than 3.00 pm on Trade Date + 1 business day to correct the erroneous marking of the sell order on your behalf.

Section 330(1) of the SFA provides that any person who, with intent to deceive, makes or furnishes, or knowingly and wilfully authorises or permits the making or furnishing of, any false or misleading statement or report to a securities exchange, futures exchange, designated clearing house or any officers thereof relating to dealing in securities shall be guilty of an offence and shall be liable on conviction to a fine not exceeding S$50,000 or to imprisonment for a term not exceeding 2 years or to both. In applying Section 330(1) of the SFA, MAS will consider whether there was intent to deceive in respect of sell orders that had been inaccurately marked by SGX-ST Trading Members or inaccurately disclosed by market participants.

You will need to ensure that securities are available for settlement on Trade Date + 2 business day. If securities are not available for settlement, CDP will conduct buying-in and impose charges and penalties. Visit SGX FAQ for more details on buying-in process, the penalty fees and Clearing information.

Please click here for more information on Short Selling.