After the approval of Croatian Financial Services Supervisory Agency (HANFA), Central Depository & Clearing Company Inc. (SKDD) confirmed on its website that new Operational Procedures and Pricelist will become effective as of 1 April 2021, with the exception of Articles 500, 500a, 500b, 501, 502, 503, 503a, 503b, 503c and 503d of Operational Procedures, which will come into effect on 1 May 2021. Cited articles are primarily focused on transposition of provisions of SRDII and Commission Implementing Regulation (EU) 2018/1212 into SKDD’s operational process and legally enable SKDD to engage into disclosure of shareholders’ identification, transfer of shareholders’ data and facilitation of the exercise of shareholders’ rights. The most important provisions are as follows:
1. Disclosure of Shareholders’ Identification
- Prescribes the issuer’s right to request disclosure of shareholders’ identification from SKDD
- Record date and response deadline must be business days
- Entry of shareholders’ identification into the SKDD IT system is possible from RD+1 until RDDT-1 (RDDT = Response Deadline)
- Shareholders’ identification for segregated custody accounts at SKDD will be pre-filled by SKDD, and subject to amendment/approval by custodian
- If SKDD is engaged by the issuer in the process of shareholders’ identification disclosure, information must be sent back to SKDD down the intermediary chain.
2. General Meetings
- Issuer is obliged to provide the basic details of the general meeting notification (in Croatian and English) by the end of the business day when the decision to convene the general meeting was made, including website containing all the details of the general meeting
- Record date (must be a business day) needs to be before the actual meeting date
- After the entitlement has been determined (as of the record date), each SKDD member holding respective shares on behalf of its clients will receive Confirmation of entitlement
- If engaged by the issuer, SKDD will collect applications to register participation on the general meeting, starting from RD+1 until RDDT (issuer may set RDDT 2 days before the general meeting date at the latest)
- In order to register participation on the general meeting via SKDD, it is necessary to disclose final beneficial owner’s details (identity and contact details), confirmation if final beneficial owner will participate in person or via proxy, if votes will be cast via post or electronically and the details of the proxy, if applicable (required details on proxy are still unknown)
- Electronic voting will be provided as a service to the local issuing companies and if engaged, SKDD will enable electronic voting per each agenda item (intermediary is obliged to forward such information down the intermediary chain by the end of the same business day when the information on electronic voting was received from SKDD)
- Electronic voting will be possible only via SKDD members (local custodians).
Disclosure request / general meeting notification will be sent to SKDD members by the end of the same business day when the issuer’s request or notification has been received by SKDD. SKDD will send the disclosure request / general meeting notification to local custodians safe-keeping the shares subject to disclosure on custody accounts or if there are pending trades in that shares with the settlement date before or equal to the event relevant record date.
Two-way communication between SKDD and market participants will be possible via SKDD’s proprietary IT system DEPRIN or STP web service in machine readable form compliant with ISO 20022 format. Technical specifications remain unavailable but are expected by the end of March 2021.
According to unofficial information, there will be no testing with the market participants.
New SKDD’s Pricelist follows the introduction of new processes into SKDD’s Operational Procedures and as such implies new fees, namely:
- fees for issuers to support General Meeting processing and disclosure of shareholders’ identification
- fees for SKDD members for electronic voting (HRK 250,00+VAT) and shareholders’ identification disclosure response (HRK 100,00 fixed amount per ISIN subject to disclosure + 10,00 per each shareholder disclosed).
New SKDD's Operational Procedures and Pricelist approved by HANFA need to be added into the request to submit CSDR licence. For that purpose, HANFA has granted on 9 March 2021 additional 30 days for SKDD to align all the internal procedures and deliver to HANFA within the CSDR licencing procedure.
Impact on investors: No direct impact expected for clients, should this change, we will provide update in due course.