The unresolved issues include questions over how to label trades in a number of situations, including when a broker-dealer is long on a stock but acting on the behalf of someone shorting it.
Another open question is how to treat short-sale orders exempt from the rules. For example, orders can be exempt if placed by official market makers. Under the new rule, these orders labeled as "short exempt" would only be acceptable following a 10% drop putting the rule in effect, and traders would have to label the same orders "short" in normal conditions.
"Obviously that makes it difficult from a programming perspective," said Dmitri Galinov, director of advanced execution services at Credit Suisse.
The new curb is a variation of the former uptick rule, eliminated in 2007, under which investors could short a stock only after it had risen, or ticked higher. In 2008, the SEC placed an emergency order temporarily barring short-selling in 799 financial company stocks after Morgan Stanley's chief executive at the time, John Mack, along with former Lehman Brothers chief executive Richard Fuld and other heads of embattled financials blamed short-selling for their companies' sliding stock prices. Market watchers have long debated whether the rule's removal played a role in the market's swoon in 2008 and early 2009.
But traders said the fact that a similar rule previously existed doesn't help prepare their systems for the new curb.
"What appears to be on the surface a relatively simple change, given the highly interconnected and complex nature of our markets, turns out to be actually quite a lot of work to get done," said a person at a large New York bank. "We're doing not much else around our trading system other than getting ready for this rule."
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