Importantly, the mainland securities regulator doesn't appear to be banning institutional short-selling. 

The China Securities Regulatory Commission (CSRC) maintained that «it will guide» the Shanghai and Shenzhen stock exchanges, and the mainland’s futures market, to strengthen supervision efforts, a Xinhua article published on Thursday indicated.

As part of that, the CSRC said that regulators do not intend to interfere with «normal market transactions» and investor rights to «free and fair transactions».

Resolute Step

«However, we will resolutely crack down on illegal activities that disrupt the market trading order, in accordance with laws and regulations,» Xinhua maintained, citing an announcement on the CRSC website.

The CSRC statement also stated that it was «not limiting share selling», something that various international media had allegedly reported recently, albeit mostly citing anonymous sources (collated Google news search).