SEC Seeks Alternative Uptick Rule

The Securities and Exchange Commission announced August 17 that it is seeking public comment on an alternative approach to short selling price test restrictions that the Commission says “may be more effective and easier to implement than previously proposed price test restrictions currently under consideration.”

According to the SEC, the alternative uptick rule would allow short selling only at an increment above the national best bid. As a result, the Commission has determined to reopen the comment period for 30 days–the original comment period for the proposals issued in April ended June 19–in order to receive input specifically on this alternative. The SEC says it “particularly seeks comments on the alternative uptick rule as a permanent market-wide approach, as well as whether the alternative uptick rule should be combined with a circuit breaker approach.”

“Today’s request for additional comment is consistent with the very deliberative process of determining what is in the best interest of investors,” said SEC Chairman Mary Schapiro, in a statement. “We want to ensure that everyone has a full opportunity to provide their comments on this alternative uptick rule before the Commission reaches any conclusions.”