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LAW OF UKRAINE

of July 6, 2012 No. 5178-VI

About depositary system of Ukraine

(as amended on 23-02-2024)

This Law determines the legal basis of functioning of depositary system of Ukraine, establishes order of registration and confirmations of the rights to issued securities and the procedure for carrying out payment under transactions of rather issued securities is right on them in system of depositary accounting of securities, and also establishes the basic principles, procedure for activities, power, the right and obligation of Central Securities Depository.

This Law also determines the legal basis of functioning of accounting system of shares of limited liability companies and additional liability companies.

Section I General provisions

Article 1. Determination of terms

1. In this Law the terms below are used in such value:

1) the account holder in securities - person for whom the professional participant of depositary system of Ukraine and/or the National Bank of Ukraine open the account in securities;

2) the global certificate - the document which contains information on issue of securities is drawn up by the issuer after completion of issue of securities, stored by Central Securities Depository (further - the Central depositary), and in the cases established by this Law - the National Bank of Ukraine, and is the basis for storage and accounting of the corresponding securities and accounting of obligations of the issuer on the corresponding issue of securities;

3) cash calculations - money transfer which is performed according to the procedure, established by the law;

4) depositary correspondent - depositary of foreign state or the international depositary and clearing institution which is client of the Central depositary and/or National Bank of Ukraine based on the established correspondence relations concerning securities;

5) depository activity - activities of professional participants of depositary system of Ukraine and the National Bank of Ukraine concerning provision of services on storage and accounting of securities, accounting and servicing to acquisition, the termination and transition of the rights to securities it is also right on securities and restrictions of the rights to securities on accounts in securities of depository institutions, issuers, depositaries correspondents, persons which perform clearing activities, depositors, nominee holders, implementation of accounting of shares of limited liability companies and additional liability companies, and also provisions of other services which according to this Law have the right to provide professional participants of depositary system of Ukraine;

6) depositary system of Ukraine - set of participants of depositary system and legal relationship between them concerning accounting of securities, rights to securities it is also right on securities and their restrictions which are set in system of depositary accounting of securities, including as a result of carrying out payment under transactions concerning securities, and also set of participants of accounting system of shares of limited liability companies and additional liability companies;

7) the depositor - the owner of securities, co-owners of securities, the notary on whose deposit securities to which the account in securities and/or agreements of depositary accounting of securities on the account of conditional storage in securities (escrow accounts in securities) (further - the agreement of escrow account in securities) opens depository institution based on the corresponding service agreement of the account in securities, and also the depository institution opening for itself the account in securities based on the order of the head of this depository institution are introduced. The National Bank of Ukraine can be the depositor in the cases provided by this Law;

8) transfer of securities - increase in quantity of securities of certain release on the account in securities of the owner of such account who is followed by introduction of certain quantity of depositary assets on this release at the professional participant of depositary system or the National Bank of Ukraine;

9) the obligation of the issuer on securities of own release - obligation of the issuer to perform certain actions for the benefit of person having the rights to securities of such release, content and which amount are determined by the current legislation and/or the decision of the issuer, or to refrain from certain actions;

10) essential participation in the Central depositary - immediate and/or mediate possession by one person (except the state and the National Bank of Ukraine) independently or together with the connected persons 1 in more percent of the authorized capital of the Central depositary;

10-1) No. 738-IX is excluded according to the Law of Ukraine of 19.06.2020

11) corporate transactions of the issuer - transaction of the issuer concerning issue, the redemption, crushing, consolidation, converting, repayment, cancellation, the payments of the income for securities and also connected with the termination of the issuer, change of the size of the authorized capital of the issuer and also other transactions for the list determined by the National commission on securities and the stock market (further - the Commission);

11-1) No. 738-IX is excluded according to the Law of Ukraine of 19.06.2020

11-2) nominee holder - the foreign financial organization which is registered in the state which is the member of the European Union and/or the member Gruppy of development of financial measures of anti-money laundering (FATF) and is member of International association for system concerning servicing of securities (ISSA), conforms to the requirements established by the Commission and according to the legislation of the state in which it is registered, has the right to provide to the clients services in accounting of securities and registration of transition of the property right to securities, including in other states based on the relevant contracts with foreign financial institutions;

12) the translation of securities (the rights to securities and/or it is right on securities) movement of certain quantity of securities (the rights to securities and/or it is right on securities), which displays at the professional participant of depositary system or the National Bank of Ukraine the translation of securities (the rights to securities and/or is right on securities) the corresponding release from one account in securities into other account in securities in case of which the amount of depositary asset on this release does not change, or carrying out the transactions connected with establishment and lifting of restrictions of the rights to securities and/or is right on securities;

13) the rights to securities - the material rights to securities (the property right, other material rights determined by the law);

14) the rights on securities - the rights arising from the obligation of the issuer on the securities placed by it (the participation right in general shareholder meetings, the right to the income, other rights determined by the law and/or the decision of the issuer);

15) professional participants of depositary system of Ukraine - Central depositary, depository institutions;

16) the register of owners of personalized securities - the list of owners of personalized securities constituted according to requirements of the legislation the Central depositary or, in the cases established by this Law, the National Bank of Ukraine for certain date with indication of the number of the personalized securities ought to the specified owners on the property right, the nominal cost and type of such securities and the other information determined by the Commission;

17) payment under transactions concerning securities - settlement of cross liabilities according to transactions concerning securities by money transfer or display by person performing clearing activities in system of clearing accounting, scope change of the rights and obligations of means between the parties of transactions concerning securities with reflection of transition of right to claim to means and/or the translation of securities and/or translation/write-off/transfer of the rights to securities it is also right on securities and/or discharge of results of netting;

18) calculations for the principle "delivery of securities against payment" - the mechanism of payment under transactions concerning securities during which according to the procedure, established by the National commission on securities and the stock market, there is translation of securities and/or the translation of the rights to securities and it is right on securities right after the corresponding money transfer and/or discharge of results of netting;

18-1) risk management system and guarantees of person performing clearing activities - complex of the actions directed to decrease in risks of failure to carry out or untimely accomplishment of the obligations arising under contracts with financial instruments;

19) write-off of securities (the rights to securities and/or it is right on securities) reduction of quantity of securities (the rights to securities and/or it is right on securities) certain release on the account in securities of the owner of such account who is followed by removal (withdrawal) of certain quantity of depositary assets on this release at the professional participant of depositary system or the National Bank of Ukraine;

20) calculations in securities - the translation of securities and/or translation/write-off/transfer of the rights to securities is also right on securities which is performed according to the procedure, established by the law;

21) the temporary global certificate - the document containing information on issue of securities which is offered to placement is drawn up by the issuer for issue of securities, stored by the Central depositary, and in the cases established by the law - the National Bank of Ukraine, and is the basis for capture on accounting of securities and accounting of obligations of the issuer on securities of the corresponding release;

22) participants of depositary system of Ukraine - The National Bank of Ukraine, professional participants of depositary system of Ukraine, clearing organizations, operators of the organized markets, issuers, investment firms, the companies on asset management, depositors, foreign depositaries - correspondents.

2. The terms "internal system of accounting of person performing clearing activities", "clearing", "international identification code of the legal entity (LEI code)", "netting", "operator of the organized market" and "risk management system and guarantees of person performing clearing activities" in this Law are used in the value given in the Law of Ukraine "About the capital markets and the organized goods markets".

The paragraph of the twenty eighth is excluded.

The term "the authorized electronic system" in this Law is used in the value given in the Law of Ukraine "About joint-stock companies".

Article 2. Legislation on depositary system of Ukraine

1. The legislation on depositary system of Ukraine consists of the Civil code of Ukraine, this Law, the Law of Ukraine "About the capital markets and the organized goods markets", other laws of Ukraine and regulatory legal acts of the Commission and National Bank of Ukraine.

2. If the international treaty of Ukraine which consent to be bound is provided by the Verkhovna Rada of Ukraine establishes other regulations, than those which contain in this Law are applied regulations of the international treaty.

Article 3. Types of depository activity and their combination

1. In Ukraine such types of depository activity can be performed:

1) depository activity of the Central depositary;

2) depository activity of the National Bank of Ukraine;

3) depository activity of depository institution;

4) activities for storage of assets of institutes of joint investment;

5) activities for storage of assets of the pension funds.

2. Depository activity of depository institution can be combined with activities for storage of assets of institutes of joint investment and storage of assets of the pension funds.

The activities provided by Items 3-5 of part one of this Article cannot be performed by the Central depositary.

The activities provided by Items 3-5 of part one of this Article can be performed by the National Bank of Ukraine in the cases established by the legislation.

Depository activity of depository institution can be combined with activities for trade in financial instruments and/or banking activity on condition of implementation of such types of activity by separate structural divisions of depository institution according to the procedure, established by the Commission.

Depositary by activities of the Central depositary it can be combined with clearing activities in the cases established by the Commission.

Depository activity of the National Bank of Ukraine can be combined with clearing activities.

Combination of depository activity (except for depository activity of the National Bank of Ukraine) with other types of activity, except established by the law, is forbidden.

The paragraph of the eighth is excluded according to the Law of Ukraine of 15.05.2018 No. 2418-VIII.

Article 4. System of depositary accounting of securities

1. System of depositary accounting of securities (further - system of depositary accounting) - set of information, records about issued securities (type with indication of type, nominal value and quantity, the register of codes of securities (international security identification numbers), restrictions in turnover and so forth) on accounts in securities of owners of such accounts; information on issuers; about owners of securities which have the rights on securities and the rights to securities; about restriction of the rights to securities it is also right on securities; about persons authorized by owners of securities (the managing directors, pawnbrokers, other persons given the appropriate rights concerning securities); about nominee holders; other data allowing to identify issued securities and specified persons; other stipulated by the legislation information.

Requirements to the list of documents which are filed by the issuer to the Central depositary and in the cases established by this Law - to the National Bank of Ukraine, and also procedure for registration and accounting of global certificates, temporary global certificates, and their details are established by the Commission, and in the cases established by this Law - the National Bank of Ukraine.

2. Acquisition of rights and the termination of the rights to securities and the rights on securities are performed by fixation of the corresponding fact in system of depositary accounting. In system of depositary accounting restrictions of the rights to securities are registered. In system of depositary accounting restrictions of the rights on securities in cases and according to the procedure, established by the Commission can be registered.

The fixing provided by paragraph one of this part, restriction in case of their making on securities which are considered on the account of the nominee holder are performed taking into account the features established by the Commission.

Requirements to information which is entered into the system of depositary accounting are established by the Central depositary in coordination with the Commission.

Article 5. Accounts in securities

1. The account in securities of the depositor is opened by depository institution based on the service agreement of the account in securities for the owner of securities, co-owners of securities or the notary on whose deposit securities, and also to the most depository institution (based on the order of the head of this depository institution) or to the National Bank of Ukraine according to the legislation are introduced.

The account in securities of the depositor is opened by the National Bank of Ukraine when implementing of depository activity of depository institution by it based on the service agreement of the account in securities for persons determined by the National Bank of Ukraine in coordination with the Commission according to the law.

The depository institution can open for the depositor of securities several accounts in securities of the depositor.

The service agreement of the account in securities is signed between the depositor and depository institution according to which the depository institution in the procedure established by the Commission on the account in securities records securities which belong to the owner, co-owners of securities, in case of transfer of securities on the deposit of the notary - to the corresponding creditor, and also accounting of the rights of specified persons to securities which are considered on certain account in securities, and restrictions of such rights.

The depository institution on own account in securities in the procedure established by the Commission (The National Bank of Ukraine - according to the procedure, established by it in coordination with the Commission) records securities which belong to it on the property right, and also accounting of the rights to these securities and restrictions of such rights (except the cases established by the law).

The account of conditional storage in securities (further - escrow account in securities) is opened by depository institution to the owner of securities based on the agreement of escrow account in securities which consists between the owner of securities, the beneficiary and depository institution or between the owner of securities and depository institution.

The depository institution can open for the owner of securities several escrow accounts in securities.

Under the agreement of escrow account in securities the depository institution in the procedure established by the Commission records the rights to securities and restrictions of the rights and the rights on securities on the corresponding account and carries out only transfer operations of securities to the beneficiary or person specified to them, or the translation of such securities to their owner into the account determined by it after approach of the bases provided by such agreement.

By the agreement of escrow account in securities the obligation on check of approach of the bases for the translation of securities to the beneficiary or person specified to them or return to their owner of securities by transfer to its account in securities opened based on the service agreement of the account in securities can be assigned to depository institution. If the obligation on check of approach of the bases for the translation of securities is assigned to other, than the depository institution, person, depository institution has the right to make such transfer only on condition of obtaining from other person of the documents confirming approach of the bases specified in the agreement of escrow account in securities.

If other is not provided by the agreement of escrow account in securities, neither the owner of securities, nor the beneficiary has no right to dispose of securities, the rights to which are considered on escrow account in securities.

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