SEC Reduces Cost, Time for Transmission of Shares

The Securities and Exchange Commission (SEC) has further reduced the time, processes and costs of the transmission of shares from a deceased to the beneficiary. This move, according to the commission was in line with its determination to reduce the quantum of unclaimed dividends in the Nigerian capital market and encourage beneficiaries of deceased investors to step up efforts to claim such dividends.

In an amended draft on the operating framework for transmission of shares, SEC reduced the timeline for the transmission of deceased’s shares from three weeks to one week. Going by that, registrar shall ensure that shares of a deceased are transmitted within a week of receiving the request from the administrators or executors.

The registrar was also required to transmit the Letter of Administration to the Probate Registry within 24 hours of receipt of same for verification.

The administrators/executors are, however, required to provide letter of Introduction introducing themselves as the legal representatives of the Estate. The letter should also indicate the names, addresses, signatures and BVNs of the individual Administrators/ Executors.

Also required are original Death Certificate from the National Population Commission (NPC) for sighting, original probate letter or Letter of Administration for sighting or the Certified True Copy (CTC) from a Notary Public. Others are copy of newspaper advert placed by the Court or Gazette, any evidence of ownership of the investment i.e. CSCS statement(s) of the deceased, original share certificates, dividend stub or dividend warrants or bank statement(s) showing receipt of dividend(s) into the account(s) of the deceased.

“Where the Administrator/ Executor cannot provide these requirements, the Registrar may require confirmation through insurance, indemnity or interview” the SEC stated.

SEC explained that registrars are also disallowed from charging fee on dematerialisation of share certificate and mandating of accounts for electronic dividend. However, change of address, name or mandate shall not attract more than N100 per request while update of update of signature capture and scanning shall not be more than N200 per signature.

The SEC further states that any registrar that violates the provisions of the rules shall be liable to a penalty of not less than N1 million and an additional sum of N20,000 for every day the violation persists.