SEC begins to register general agent company

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Deputy Group Business Editor Taofik Salako

The Securities and Exchange Commission (SEC), Nigeria’s highest capital market regulator, instructs non-custodial companies to hold securities for their actual owners and apply to the commission for registration as agents. Part of the regulatory framework for the nomination function released over the weekend. The rule requires persons who have not been registered as custodians by the committee to engage in nominee business and hold securities for their actual owners must apply to the committee for registration as a nominee. Such securities include stocks, money market, fixed income securities and derivatives (except pension assets).
A nominee is a company established by a bank or other financial institution to hold securities and other assets and is managed by the actual owner
According to the rules, the business of the nominee should be on behalf of the client or on behalf of the client The ownership of the trust property, money or securities of the company shall strictly follow any instructions issued by the respective clients to the nominated company from time to time to hold and handle such property, money or securities.
The rules also stipulate that the nominee shall not engage in any business or activity other than the business.
The rules stipulate that the nominating company should have at least three guaranteed persons, one of whom should be a compliance officer.
In addition, the company’s managing director should always comply with the sponsor’s registration requirements and become a member of the sponsor, and the nominee company should have the necessary infrastructure, including insurance for safekeeping of title documents, agreements and information The SEC stated that the nominated company must abide by the rules and regulations of the committee’s code of conduct for capital market operators and their employees. In addition, any person registered as a nominee by the Commission shall not engage in the business of nominees under these rules; do not invest in securities; and have sound risk management procedures and mechanisms to comply with their parent company’s anti-money laundering-anti-terrorism financing ( AML/CFT) regulations.
For mergers and acquisitions, they must notify customers. Customers should
According to the rules, if registration is suspended or deregistered, nominees should notify all their customers, including custodians, within 24 hours to retain their appointment to the new company or to remain in Rights in the new entity. Or revoke, and is obliged to appoint another nominee company within 90 days from the effective date of suspension or revocation. “If any client fails to appoint another nominee, the committee shall appoint another nominee to take over the custody of the assets.
” If the nominee company decides to suspend business, please notify the committee and its client. The nominee company shall notify the client of its obligation to appoint another nominee within 90 days from the date of notification, and the nominee company shall transfer the assets to the client’s designated nominee within five working days, otherwise the committee A trustee will be appointed. .. “Before deciding to suspend business, it shall comply with the regulations of the committee on deregistration. The nominee company shall comply with the committee’s regulations on internal control; monitor, review, evaluate and inspect the system and control; independent escrow account; reach agreement with clients Agreement; record keeping and disclaimer” rules.

According to the rules, the functions of the nominee company include maintaining client securities accounts, collecting all rights or benefits on behalf of clients or accruing
securities held by clients, managing client holdings, including facilitating sales under client’s authorization, Purchase, lend and borrow securities and liquidate investment obligations, and ensure compliance with contractual obligations with customers and custodians.
Other functions include maintaining and reconciling service records, maintaining sufficient information and recording to identify the beneficial owners of securities held by them, and providing regular information to customers and custodians, in which securities and other assets are transferred to Nominee company.

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