On November 24, Law No. 2418-VIII “On Amendments to Certain Laws of Ukraine Concerning the Facilitation of Attracting Foreign Investment” came into force.
Thus, the Law “On the Depositary System of Ukraine” introduced the concept of “nominee holder”, a foreign financial institution that is registered with a Member State of the European Union or the Financial Action Task Force on Money Laundering (FATF), meets the requirements of the e Commission and provides its clients with services of securities accounting and registration of securities ownership transfer, in other states on the basis of relevant agreements with foreign companies financial institutions .
It is also established that a depository institution on the basis of a relevant agreement can open accounts with a foreign financial institution that is registered in a EU member state or group (FATF) (except for a financial institution of the Russian Federation or controlled by residents of Russia) to provide its clients with securities accounting services foreign issuers and restrictions on such securities, registration of transfer of ownership of the relevant securities and other services provided by such a state law .
According to the changes, a nominal holder’s securities account is opened by a depository institution to a foreign financial institution on the basis of a contract for the provision of services to maintain a nominal holder’s securities account. This provision is made for the nominal holder to disclose the information in cases established by law, and restrictions on the owner’s securities, the rights to which and for which are recorded on the securities account of the nominal holder, on the basis of supporting the documents received from the depository institution. Also, the contract should provide the obligation of the nominal holder regarding compliance with the requirements of the legislation on sanctions.
On a securities account of a nominal holder, the depositary institution keeps records of securities, rights to securities and rights on securities that belong to the customers of the nominal holder, as well as the customers of the client of the nominal holder. Securities whose rights are accounted for in the nominal holder’s account may not be penalized for the obligations of the nominal holder.
A foreign financial institution may open several securities accounts of a nominal holder in a depository institution for depository accounting of the securities of its customers.
In case of non-disclosure by the nominal information holder, the Commission has the right to prohibit or to limit, for a period of elimination of the violation, the conduct of the whole or certain depositary operations in the securities account of the nominal holder.
The number of rights to securities on a securities account of a nominal holder must be an integer. The changes are also made to the Law “On the Prevention and Counteraction of the Legalization (Laundering) of Proceeds from Crime, Financing of Terrorism and Financing the Spread of Weapons of Mass Destruction”. It clarifies the additional measures to be taken to identify the subject of the primary financial monitoring. The Law also defines the concept of “correspondent relations”: they arise during the opening of a correspondent account by a correspondent bank to another bank on the basis of an agreement of the establishment of correspondent relations for making interbank transfers; established by the Central Depositary of Securities with Depositories of Foreign States and International Depository Clearing Institutions; established by a depository institution with a foreign financial institution on the basis of an agreement on the provision of services for the maintenance of a securities account of a nominal holder.
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