What is a Central Securities Depository?

A Central Securities Depository is an organization specialized in the registration, management and control of securities both in physical and electronic format in order to facilitate and make more transparent and secure their transactions, such as purchase, sale, transfer, among others.

What are securities?

Securities are financial instruments issued by companies and the state that grant the holder the right to receive interest and/or dividends in a certain amount and, in some cases, also grant the right to participate in the strategic decisions of issuers. Examples of securities are shares, government bonds, corporate bonds, commercial paper, among others.

The securities are also called equity securities (which guarantee the holder the ownership of company shares and sometimes participate in strategic decisions of the same, as well as the right to dividends) and debt securities (which are issued by entities that require funding and grant the holder the right to interest). In Portuguese the expression "títulos" is also used to refer to securities.

 

Who should register at the Central Securities Depository?

All public companies and other issuers of securities shall apply for registration thereof in the Central Securities Depository. The registration process can be conducted either by the company, a financial intermediary (banks, brokerage firms and broker-dealers) or by a lawyer.

How to register securities in the Central Securities Depository?

The instruction of the registration process can be found in Article 14 and Article 15 of the Securities Central Operation Regulations.

Is the registration in the Central Securities Depository compulsory?

The registration in the Central Securities Depository is compulsory as stated under Article 13 of the Central Securities Depository Operation Regulation.

The deadline for this registration is the 5th of November 2015.

What are the registration costs?

Registration costs of securities in the Central Securities Depository are set out in the Operating Rules of the Central Securities Depository, Ministerial Decree No. 130/2013 of September 4.

The securities registered in the Central Securities Depository must be traded in the Exchange?

Only the securities registered in the Central Securities Depository and listed on the Exchange must be traded. The securities registered in the Central Securities Depository and not listed on the Stock Exchange can be traded in the OTC market.

Are there any costs associated with the transfer of securities from a broker to the other?

The transfer of securities from a broker to another is free and should be done only at the request of the holder to the broker that performs custody of the securities to be transferred.

Who has access to the system of the Central Securities Depository?

The Central Securities Depository is accessed by brokerage firms, broker-dealers and banks acting as brokers and custodians of securities.

Can the Investor request the Central Securities Depository information regarding the securities in his possesssion (ownership)?

No. The investor must send their requests for information about their ownership status to the bank, brokerage firm and/or broker-dealer in which the securities are stored/registered.

What is the function of the Central Securities Depository cards?

The Central Securities Depository card is a security holders’ identification instrument, containing the holder's name and their customer number in the Central Securities Depository. This card must always be presented to the financial intermediary (banks, brokerage companies and broker-dealers) whenever the holder wants to perform a transaction of securities.

What are the ISIN and CFI codes?

The ISIN code (International Securities Identification Numbers) is a sequence of organized letters and numbers that identify internationally and uniquely each security issued.

The CFI code (Classification of Financial) is an international code that describes the characteristics of a type of security.

 

Who assigns ISIN and CFI codes?

The Mozambique Stock Exchange is accredited by ANNA (Association of National Numbering Agencies) as the National Numbering Agency of Mozambique, giving it the right to assign the ISIN, CFI and other relevant codes to securities.

Is there any costs associated with the allocation of ISIN and CFI codes?

The allocation of ISIN and CFI codes is free of charge.