The SEC seeks public input on proposed amendments to short selling and securities borrowing rules, aiming for efficiency and enhanced oversight. Key changes include clarifying definitions and improving risk management processes.
The SEC is seeking public comments on proposed amendments to short selling and securities borrowing and lending rules to enhance regulatory oversight and efficiency in the current capital market context. The SEC’s proposals are based on public hearings, ongoing discussions with stakeholders, and feedback that largely supports the principles while suggesting refinements to better align with brokerage practices and lessen burdens on businesses.
Key proposed amendments include:
(1) Clarifying the definition of short selling transactions;
(2) Enhancing the efficiency of short selling services, such as Know Your Customer (KYC) procedures for inter-broker* clients, and short selling order acceptance and transmission process;
(3) Requiring clients to provide assurance that clients have borrowed or located
a source of securities borrowing before placing short selling orders. Moreover, the SEC proposes to remove the requirement for brokers to include a clause in the service agreement requiring clients to pay compensation if brokers are penalized due to the client’s fault.**
In addition, the SEC proposes to improve the SBL service rules for more clarity by emphasizing that securities companies must have effective risk management systems and only lend or confirm the availability of securities for lending when sufficient securities are actually held. This measure aims to prevent risks arising from lending or confirming lending more than available securities.
The consultation paper is available at on the SEC website at https://www.sec.or.th/TH/Pages/PB_Detail.aspx?SECID=1136 and the legal hub at https://law.go.th/listeningDetail?survey_id=NjQxM0RHQV9MQVdfRlJPTlRFTkQ=. Stakeholders and interested parties are welcome to submit comments and suggestions via the SEC website or by email at laksika@sec.or.th, gritchanut@sec.or.th, phachisa@sec.or.th or anudporn@sec.or.th. The public hearing ends on 11 February 2026.
