October 14 2003
The Law for Measures to Reform the Spanish Financial System (44/2002) created the Securities Registry, Clearance and Settlement Systems Management Company (Iberclear). As of April 1 2003 Iberclear is the central securities depository for Spain.
Iberclear was created through a merger between the Clearance and Settlement System of the Spanish Stock Exchanges and the Spanish Central Public Debt Registration, which was managed by the Bank of Spain.
Iberclear is part of the holding company Bolsas y Mercados Españoles, Sociedad Holding de Mercados y Sistemas Financeros SA. This company integrates the Spanish fixed income markets, stock exchanges, derivatives markets, and clearance and settlement systems.
As central securities depository in the dematerialized securities market, Iberclear is in charge of (i) the Central Registry of Securities represented through book entry form or through electronic form, and (ii) the clearance and settlement of transactions. Iberclear manages two different systems (technological platforms) of clearance and settlement, one for stock exchange transactions and one for public debt market transactions.
Iberclear is in charge of the registration, clearance and settlement of transactions carried out in the following Spanish markets:
Due to the growing complexity of the investment products marketed by financial entities, especially those marketed to retail investors, in June 2003 the Spanish National Securities Commission approved a new guide containing principles and recommendations for the transmission of information to investors, which financial entities must approve.
The guide is aimed at all entities which commercialize investment products such as shares, bonds, preferred securities and investment funds, and establishes certain rules governing the quality of the information that is transmitted by financial entities to retail investors.
The main contents of the guide may be summarized as follows:
Under Article 14 of the Securities Market Law (24/1988) the board of the National Securities Commission is obliged to approve a regulation outlining the commission's structure and the distribution of competencies among the commission's bodies. On July 10 2003 the board duly approved one such regulation.
The Internal Regime Regulation contains 59 articles divided into eight chapters. The introductory chapter explains the general dispositions that govern the commission's internal regime as follows:
There are three bodies under the president's supervision:
The regulation also contains provisions on administrative procedure, employee selection and the commission's budget.
On July 6 2003 the Law on Foreign Capital Transfers and Financial Transactions and on Certain Measures to Prevent Money Laundering (19/2003) was enacted. It creates a new Second Additional Disposition to the Law on Investment Ratios, Capital Adequacy and Information Requirements for Financial Intermediaries (13/1985). The new disposition establishes, for the first time, rules governing the issue of preferred securities by Spanish credit entities directly or indirectly through a credit entity group subsidiary incorporated in an EU member state (other than tax havens, as defined in Royal Decree 1080/1991), the sole corporate purpose of which is the issue of preferred securities. The voting rights in the subsidiary must be held by the Spanish credit entity.
In order to benefit from a favourable tax regime the issue of preferred securities must comply with certain requirements, which may be summarized as follows:
In addition to credit entities, this regime may also be applicable to listed companies.
For further information on this topic please contact Javier Ybáñez at Garrigues Abogados & Asesores Tributarios by telephone (+34 91 514 52 00) or by fax (+34 91 399 24 08) or by email (firstname.lastname@example.org).
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