The US Securities and Exchange Commission has made permanent an emergency rule aimed at reducing abusive short-selling, put in at the height of last autumn's market turmoil.
The commission said on Monday it took the action on the rule targeting so-called "naked" short-selling which was due to expire on Friday.
Short-sellers bet against a stock. They generally borrow a company's shares, sell them, and then buy them when the stock falls and return them to the lender - pocketing the difference in price.
"Naked" short-selling occurs when sellers don't even borrow the shares before selling them, and then look to cover positions sometime after the sale.
The SEC rule includes a requirement that brokers must promptly buy or borrow securities to deliver on a short sale.
At the same time, the SEC has been considering several new approaches to reining in rushes of regular short-selling that also can cause dramatic plunges in stock prices.
Investors and lawmakers have been clamouring for the SEC to put new brakes on trading moves they say worsened the market's downturn starting last autumn. SEC chairman Mary Schapiro has said she is making the issue a priority.