Dual listing, doubly safe
FOLLOWING THE publishing of Vic de Klerk’s article in Finweek of 15 February 2007, we have had a number of concerns and enquiries expressed, as there has clearly been some misunderstandings of requirements for share movements across jurisdictions.
We thought it best to advise our observations on some of the realities of moving shares between different jurisdictions and I comment as follows: 1. All movements of shares into and out of SA on dual or plc registers (UKlisted companies), are always subject to exchange controls (“Excon”), so it’s not as simple as the article indicates. Strate, CSDPs, any individual or broker would have to comply with specific Excon-published regulations, which cannot be overridden without serious consequences for shareholders. 3. There’s no “button” to speak of, as all movements between jurisdictions are in Certificated form and cannot happen without intervention of the Transfer secretary / Registrars and very specific administrative controls and requirements on the registers in the respective jurisdictions where it’s listed. Such registers are carefully kept in balance at all times. 4. Plcs are a special case in as far as a special nominee was set up by Strate (UK act does not recognise other CSDs in the world – only CREST) and effectively they therefore hold the Dematerialised shares of plcs on register in SA in a purpose Nominee (“Plc Nominees”); the only practical way to move these shares is by way of formal transfer form after “dematerialisation” into paper certificates. Transfer forms are “signed” by Plc Nominees (Strate) as the
official recognised holder on register, and again all the paperwork has to be lodged with the transfer secretaries to effect such share movements. It follows therefore that neither does Strate control all holders, but only those dematerialised in Strate – participants and any thus certificated register participants are not included in that process. Certificated holders have to move shares to other jurisdictions through formal request to their local Registrar after due approval of an authorised Excon agent of SARB (mainly the large SA banks). Their certificates have to be endorsed as non-resident by authorised agents prior to removal to another jurisdiction. Trust this gives some perspective