NDC to Fine JSC Delaying Conclusion of Contracts with It

CJSC National Depository Center (NDC), a monopoly on the provision of depositary service for securities and on maintaining the register of holders in Azerbaijan, introduced on 31 December 201 a new tariff policy that those JSC that delay the conclusion of contracts with it will be attracted to a fine.JSC located in Baku will be fined in the amount of 300 manat, and others – in the amount of 150 manat.

NDC operates under the State Committee for Securities. Contrary to the laws, the Center does not publish annual reports in a timely manner, and the latest annual report concerns 2011. According to this report, NDC provides services f depositing securities and maintaining the register of holders of 1,645 issuers of securities. Several years ago, the center changed its tariffs, according to which issuers began to pay it for the period during which they delayed a contract with NDC.

NDC charges at 0.05% f the authorized capital of JSC for services in the territory of Baku and 0.025% - for JSC located outside Baku.

The decision to impose fines was adopted at the general meeting of shareholders (the sole shareholder is the State Securities Committee), which took place on December 16. However, it was published only on the last working day of the year.

At the beginning of 2012 NDC served 101,256 individuals and 625 corporate investors. In 2011, revenues of NDC amounted to 1,111,500 manat, and its net profit was 101,500 manat. ---08B