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Thu, 05/11/2015

Uzbekistan aligned numerous Government resolutions with the new securities market legislation. By Yuliya Shibukova, Relationship Manager, GSS Russia                                                                                                      

The Cabinet of Ministers revised an outdated legislation framework by revising a large scope of Government resolutions in order to bring them in line with the new editions of the Law on the Securities Market and the Law on Investment and Mutual Funds.

The main legislation provisions were amended as follows:

  • Investment agents may act on behalf of their clients based on signed depository and brokerage agreements concluded for a 1-year period with possibility of prolongation of the term.
  • A clearing house can use various methods of clearing including netting;
  • To cover client’s losses caused by investment agent actions, clearing houses to form a guarantee fund through a 5% commission fee of investment agent;
  • Depositors have to report CSD and (or) investment agent on amendments to their personal data or company details;
  • To get a license an investment agent should fulfill requirements of compliancy with IT software and readiness to communicate electronically with professional market participants, stock exchange and CSD.

Taking into account that the revised edition of the Law on the Securities Market abolished depository activity as a professional activity in the securities market and included it in the list of investment agent functions, the Ministry of Justice amended the Regulation which governs activity of professional securities market participants.

In particular, the following combinations of the securities market professional activities are allowed now with rare exceptions:

  • Professional activity of investment agents with activities of investment advisor and trustee of investment assets;
  • Professional activity of investment advisors with activities of investment agent, trustee of investment assets and transfer agent;
  • Professional activity of trustees of investment assets with activities of investment agent, investment advisor and transfer agent;
  • Professional activity of transfer agents with activities of investment adviser and trustees of investment assets.

In addition, a transfer agent is not entitled to exercise the professional activity of a investment agent and organiser of securities trading. The Central Securities Depository may combine CSD professional activity only with transfer agent functions.