When will the money be completely dematerialized?

The mandatory dematerialization of company shares from 2020 is intended to prevent money laundering

Big changes await companies from the new year. The compulsory dematerialization of stocks will mean a number of new obligations for them. Check what exactly the amendment to the Commercial Code (KSH) introduces and what formalities companies will have to complete in the next year.

The amendment to the KSH provides for the introduction of the obligation to dematerialize the shares of stock corporations and limited partnerships. The point is to change the form of shares from a security to an entry in the IT system. The company's first obligations and formalities must be completed in the next year, the most important of which are listed below. (...)

Directory of shareholders or custody account maintained by the KDPW

From January 1, 2021, all shares are to be dematerialized. Correspondingly, companies must create a register of shareholders or register shares in the custody account maintained by the National Securities Depot (KDPW).

- The register of shareholders is kept in electronic form by a brokerage house that has a license to manage securities accounts, or by a trust bank - says lawyer Magdalena Szeplik from GESSEL to Strefa Inwestorów.

- Shares from the same company may not be entered in the directory of shareholders and in the KDPW at the same time. Non-public companies can choose where to register their shares. However, it should not be forgotten that, among other things, the election of the KDPW entails the need to organize a general meeting on the same terms as for a public company, with the exception of the provisions on the publication of current reports - explains Szeplik. (...)

In addition to the duties, there are also some advantages

The dematerialization of stocks is not just mandatory. You can also find some advantages of the new regulation.

- The benefit of the change will be taken by shareholders as the dematerialization will minimize the risk associated with the impact of the loss of securities. It should be noted that the loss of papers in the current legal status was associated with the need to issue duplicates and therefore, in many cases, to go through the procedure provided for in the decree of December 10, 1946 on the deletion of lost documents - said Szeplik, lawyer at GESSEL . (...)

The full content of the article (in Polish) can be found on www.strefainwestorów.pl