Listing process Regulated Market

Listing process Regulated Market General Standard

Custody

The company certificates the securities and deposits them at a securities clearing and deposit bank in order to allow settlement of securities transactions and custody and administration of rights connected to the securities, like e. g. dividend payments, corporate actions and general shareholders meetings.

Briefly, you have to do the following:

  • Prepare a legally valid securities certificate
  • Cause the certificate’s depositing at the securities clearing and deposit bank
  • Name a principal paying agent

The admission of a company’s stock to trading at the Regulated Market is subject to the free tradability of such stock, see Sect. 5 Börsenzulassungs-Verordnung [BörsZulV, German Stock Exchange Admission Regulation]. Pursuant to EU-law (Art. 35 Verordnung 1287/2006) [Commission Regulation (EC) No. 1287/2006] free tradability requires that securities may be traded and afterwards transferred between the parties of a transaction and that all securities are fungible within the same class. In order to provide for the required transferability, the stock has to be certificated and deposited in form of a document at a central depository, a securities clearing and deposit bank. A securities clearing and deposit bank is a credit institution which assumes the central depositing of securities and which was recognized for this task by the competent official body, see Sect. 1 Depotgesetz [DepotG, German Securities Deposit Act]. At the moment, there is only one officially recognized securities clearing and deposit bank in Germany which is the Clearstream Banking AG, Frankfurt am Main (“Clearstream“). The inclusion of stock of German companies in the Open Market at Frankfurt Stock Exchange also requires depositing a securities certificate with the CBF.

There are various options for the certification of securities as well as for their depositing. In the scope of an IPO, the issuing house will usually submit the stock in form of a permanent global certificate for the issuer at Clearstream for collective custody. Please learn below what exactly this procedure means and how it works: