Processing of applications for admission of physical securities certificates to collective safe custody
Clearstream Banking1 continues to aim for the efficient and prompt processing of applications for the admission of physical securities certificates to collective safe custody. In order that this can be ensured, especially with regard to the TARGET2-Securities (T2S) migration of the German market planned for February 2017, CBF, with effect from
1 September 20162
will only process applications from issuing banks (issuing agents/lead managers) for the admission of physical securities to collective safe custody, deposited over the counter or via the EDT Lean service, if
- the admission forms for the type of securities in question are used; these are provided by CBF under Admission forms collective safe custody (see also Announcement D16015) and must be completed and signed in legally binding form by the persons authorised to sign on the customer's behalf and whose signature has been deposited with CBF;
- a copy is attached of the deposit instruction that the customer has entered in CASCADE (KVEW);
- the submitted issue documents (see table below) for the type of securities and securities issue in question are complete and consistent;
- a declaration has been received from a third-party bank with a CBF linkup stating that it will assume the function of collection agent vis-à-vis CBF (‘paying agent declaration’) unless the issuing bank (issuing agent/lead manager) itself assumes the role of collection agent for the securities to be admitted; and
- CBF offers safe custody and administration services in relation to the legal system and legal structure (securities in bearer for or in registered form) under which the securities in question are to be issued.
Processing will be generally carried out in the order that CBF receives the complete and consistent applications for admission with consideration being given to the customer's intended issue date or, if this is not a business day of CBF, the next business day, on a best-effort basis. After receiving the applications for admission CBF will carry out a cursory check in order to verify whether all the formal requirements for admission that have been mentioned above have been fulfilled. If this is not the case, CBF will notify the issuing bank (issuing agent/lead manager) in a suitable form and, if applicable, also the designated collection agent. It is entirely a matter for the issuing bank (issuing agent/lead manager) to provide the missing documents and/or information or to ensure that any third parties do so.
In the case of complete applications for the admission of physical securities certificates, CBF will only guarantee entry and posting of the deposited securities on the correct value date, namely the issue date – or, if this is not a business day of CBF, on the following business day if
- these have been verifiably received by CBF before the deadlines set out in the table below;
- CBF, when checking the applications for admission, finds no legal, operational or compliance-related obstacles to entry and posting the deposited securities on the correct date in the individual case;
- the ISIN of the securities to be admitted has been registered with the responsible national numbering agency (in Germany: WM Datenservice) and is eligible for collective safe custody, as the custody type, or, in the case of non-German ISINs, has been notified to WM Datenservice and admitted in its database for collective safe custody, as the custody type.
Overview of bonds and bond-like securities
Securities deposited physically | Applicable law (‘rights embodied in the financial instrument’) | Brief overview of the necessary admission documents | Deposit deadline3 for guarantee of the issue date / value date (VD) |
Bearer bonds/ bearer debenture (commercial paper, MTNs etc.) | German law (+) |
| VD – 1 |
Bearer bonds/ bearer debenture (commercial paper, MTNs etc.) | German law (-) |
| VD – 1 |
Registered bond/ registered debenture (commercial paper, MTNs etc.) | German law (+) |
| VD – 1 |
Registered bond/ registered debenture (commercial paper, MTNs etc.) | German law (-) |
| VD – 1 |
Bearer certificate (including GDRs) warrants (bearer form) | German law (+) |
| VD – 1 |
Bearer certificate (including GDRs) warrants (bearer form) | German law (-) |
| VD – 1 |
Participation certificate | German law (+) |
| VD – 1 |
Participation certificate | German law (-) |
| VD – 1 |
Equities
Securities deposited physically | Applicable law (‘rights embodied in the financial instrument’) | Necessary admission documents | Deposit deadline for guarantee of the issue date/value date (VD) |
Bearer share | German law (+) |
| VD – 2 |
Bearer share | German law (-) |
| VD – 2 |
Registered share | German law (+) |
| VD – 3 |
Registered share | German law (-) |
| VD – 3 |
Investment fund units (retail funds, alternative investment funds)
Securities deposited physically | Applicable law (‘rights embodied in the financial instrument’) | Necessary admission documents | Deposit deadline for guarantee of the issue date/value date (VD) |
Bearer (fund) units
| German law (+) |
| VD – 3 |
Bearer (fund) units
| German law (-) |
| VD – 3 |
Registered (fund) units | German law (+) |
| VD – 3 |
Registered fund units | German law (-) |
|
|
The current version of the corresponding application forms for the various types of instruments and both own and third-party issues can be accessed electronically under Admission forms collective safe custody.
CBF points out that it can keep incomplete or inconsistent applications for admission and admission documents only for a limited time, especially for auditing purposes, and that they will ultimately be returned at the customer's expense unless the issuing bank (issuing agent/lead manager) makes demonstrable and prompt efforts to clarify any unresolved issues.
The procedures and requirements summarised above largely reflect the core elements of CBF's longstanding practice for processing applications for the admission of securities to collective safe custody. CBF therefore asks all participants acting as issuing banks (issuing agents/lead managers) and collection agents to observe these best-practice rules even before 1 September 2016, as all market participants have an interest in the efficient and swift processing of applications for admission. This will avoid unnecessary queries and delays in processing.
CBF reserves the right to unilaterally alter the deadlines for the admission of individual securities or all securities types or to alter the requirements regarding the appropriate documentation, especially due to possible requirements made by the supervisory authorities in the future. CBF will inform its participants of such changes in good time, with four weeks' notice.
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1. This Announcement is published by Clearstream Banking AG (CBF), registered office at Mergenthalerallee 61, 65760 Eschborn, Germany, registered with the Commercial Register of the District Court in Frankfurt am Main, Germany, under number HRB 7500.
2. For users of the EDT Lean service the provisions apply on the conclusion of the separate contractual agreement with CBF that is necessary for this purpose.
3. All times refer to the German time zone (CET or CEST).
4. The specified deadline may change due to the CASCADE schedule prepared in the individual case for the admission of registered shares to collective safe custody.