For Release January 30, 2004
Contact: SIA Corporate Communications (202) 216-2000
SIA Addresses SEC Proposed Overhaul Of Short-Sale Regulation
New York, NY, January 30, 2004 -The Securities Industry Association filed a comment letter with the SEC on the commission's proposal to overhaul the framework for regulating short sales of equity securities.
While SIA applauds the efforts of the SEC and its staff to modernize the regulation of short sales and to address certain abusive short-selling practices, the association expressed concern that the immediate implementation of all of the proposed provisions would disrupt the smooth functioning of financial markets by unnecessarily upsetting many well-established market practices and may not be in the best interests of investors. While some securities firms may be able to accommodate these changes, others would not be able to do so without incurring substantial costs, especially for reprogramming and testing of trading and other systems.
SIA believes the SEC should take incremental steps, including proceeding with its proposed pilot program (with certain modifications) that would exclude certain liquid stocks from all short-sale price regulations and with certain proposed uniform locate and delivery provisions, but should leave in place other current short-sale price regulations until the results of the pilot program are evaluated.
The letter is available at: http://www.sia.com/2004_comment_letters/pdf/SEC01-30-04.pdf
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The Securities Industry Association, established in 1972 through the merger of the Association of Stock Exchange Firms and the Investment Banker's Association, brings together the shared interests of nearly 600 securities firms to accomplish common goals. SIA member-firms (including investment banks, broker-dealers, and mutual fund companies) are active in all U.S. and foreign markets and in all phases of corporate and public finance. According to the Bureau of Labor Statistics, the U.S. securities industry employs 780,000 individuals. Industry personnel manage the accounts of nearly 93-million investors directly and indirectly through corporate, thrift, and pension plans. In 2003, the industry generated an estimated $209 billion in domestic revenue and $278 billion in global revenues.
