France has extended by three months the short selling ban it imposed on the shares of ten of its financial institutions.

The ban, which was introduced on August 11th to fend off speculation after France’s banks took a hammering, was supposed to have ended Friday but has been extended in the face of further financial uncertainty reports Reuters.

France’s finance minister, Francois Baroin, said though that the ban could be lifted prior to the three months end if market conditions allow.

France is one of five countries that currently have unilaterally imposed short selling bans in place for certain stocks. The others are Italy, Greece, Spain and Belgium. The Greek, Spanish and Belgian bans are open ended in date, but like France Italy’s ban is also due to expire on Friday.

Although the short sellers have been unable to borrow the stock to sell on and then buy at a lower price later and give back to the lender whilst pocketing the difference, it has not stopped the shares suffering as normal selling off occurs.

The UK’s FSA has said that it has no plans to restrict the use of short selling.

The European Securities and Markets Authority ( is due to be given wider powers over short selling enabling it to impose a more unified approach within the EU so stopping unilateral bans. It will also in the process gain the power to impose short selling bans across the EU in times of market turmoil. This of course is being contested by the UK, which fears that the City is under attack from Eurocentrically imposed powers and says that such extra powers would be ‘unlawful’.

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