Clarified Procedures for transfer of Unclaimed Dividends

AO UniCredit Bank
Summary: 
CBR clarified the procedures for transferring unclaimed dividends to issuers and to shareholders.
Tue, 26/05/2015

In line with the Central Bank of Russia letter on the return of unclaimed dividends, the following provisions shall be clarified as follows:

  • A nominee holder, to which dividends were transferred and which failed to perform its duty to transfer such dividends further on to the beneficiary, as provided for by the laws of the Russian Federation, due to reasons beyond its control, has to return such dividends to the issuer within 10 days following the expiration of one month from the final dividend payment date. In the case of involvement of any third parties (e.g. CSD) for the returning of the dividends, the obliged party shall still be the nominee holder.
     
  • A shareholder has the right to address the issuer with a request for payment of unclaimed and returned dividends within 3 years from the date of the decision on the distribution of the dividends, unless a longer period is defined by the by-laws (charter, statute, etc.) of the joint-stock company.
     
  • A shareholder has the right to address to the nominee holder as well, due to the fact that the latter is in possession of the information, which is necessary to identify the shareholder and pay the dividends. If the shareholder is no longer a client of the nominee holder, it may also send the request to the issuer directly and in line with the law the issuer is obliged to accept it.

 

Impact on investors: CBR simplified and clarified the procedures for transferring unclaimed and returned dividends by nominee holders to issuers and to shareholders.