Sebi tightens short selling rules

Markets regulator the Securities and Exchange Board of India (Sebi) on Friday modified the rules for short selling of securities in India. 

In a circular issued Sebi made it mandatory for institutional investors to disclose upfront at the time of placement of order whether the transaction is a short sale. Retail investors on the other hand will have to make a similar disclosure by the end of the trading hours on transaction day.

Additionally, Sebi has made it mandatory for brokers to collect the details on scrip-wise short sell positions. They will also have to collate the data and upload it to the stock exchanges before the commencement of trading on the following trading day. 

"The stock exchanges shall then consolidate such information and disseminate the same on their websites for the information of the public on a weekly basis. The frequency of such disclosure may be reviewed from time to time with the approval of SEBI.” Sebi said in the circular.

These rules are in addition to already existing framework existing for short selling in India, Sebi said in the circular.