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Information on Exceptional Short Sale Regulations

Please review and be sure to understand the very important information regarding exceptional short sale regulations prior to trading. Thank you!


Limitation on Short Sales in Financial Services Companies (SEC Emergency Order 34-58592)

The SEC emergency order 34-58592 expired on 9 October 2008.

Limitation on Short Sales in Certain UK Financial Services Companies (FSA/PN/102/2008)

The UK Financial Services Authority ("FSA") has issued a prohibition on short sales in approximately 40 UK-listed Financial Services Companies. The prohibition is complex and refers to any trading strategy that is economically equivalent to a short sale, and therefore applies as well to derivative strategies such as put option purchases or call option sales. The rule was scheduled to remain in effect, subject to FSA review, until January 2009. More information regarding UK short sale regulations can be found on the FSA website, and also at http://www.fsa.gov.uk/Pages/Library/Communication/PR/2008/index.shtml


Other Restrictions on Short Selling

Many countries have imposed special restrictions on short selling. PT has respected the regulations where the restriction is consistent with PT's existing systems. Where the regulations define security lending practices not currently supported by PT, we have restricted short sale activities altogether.

Pre-Borrow Restriction (short sales allowed only with pre-borrow prior to the actual sale): PT does not support pre-borrow services(1). All stocks are therefore effectively restricted: Australia, Japan, Hong Kong.

Restrictions on Specific Stocks: UK, Germany, France, Netherlands, Switzerland, Belgium, Sweden, Canada, Norway, Italy.


Special Deliver and Buy-In Regulations for US Securities (SEC Emergency Order 34-58572)

SEC Emergency Order 34-58572 expired on October 17, 2008.

Securities and Exchange Commission Release No. 34-58773

Amendments to Regulation SHO

Interim final temporary rule and request for comments

SUMMARY: The Securities and Exchange Commission ("Commission") adopted an interim final temporary rule under the Securities Exchange Act of 1934 ("Exchange Act") to address abusive "naked" short selling in all equity securities by requiring that participants of a clearing agency registered with the Commission deliver securities by settlement date, or if the participants have not delivered shares by settlement date, immediately purchase or borrow securities to close out the fail to deliver position by no later than the beginning of regular trading hours on the settlement day following the day the participant incurred the fail to deliver position. Failure to comply with the close-out requirement of the temporary rule is a violation of the temporary rule. In addition, a participant that does not comply with this close-out requirement, and any broker-dealer from which it receives trades for clearance and settlement, will not be able to short sell the security either for itself or for the account of another, unless it has previously arranged to borrow or borrowed the security until the fail to deliver position is closed out.




All investing involves risk, including the possible loss of principal and there can be no assurance that any investment strategy will be successful.