Japan: New share certificate system

Nagashima Ohno & Tsunematsu, Tokyo | February 01, 2009

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On January 5 2008, the electronic share certificate system under the Law on Book-Entry Transfer of Corporate Bonds, Stock and Other Securities (shasai-kabushiki-tou-no-furikae-ni-kansuru-horitsu) will be implemented. Upon implementation, all shareholders' rights in listed companies will be recorded and managed electronically in transfer account books (furikae-kouzabo) maintained by record-keeping organisations (kouza-kanri-kikan) such as banks and securities companies. Under the present system, shareholders hold paper share certificates and transactions are conducted by physically transferring the paper share certificates. In accordance with the Act on Custody and Transfer of Share Certificates (kabuken-tou-no-hokan-oyobi-furikae-ni-kansuru-horitsu), shareholders of listed companies also have the option of depositing paper share certificates of those listed companies with the Japan Securities Depository Center (JASDEC) (hofuri), a public custody organisation in Japan. However, with the implementation of the new system, paper share certificates will no longer be used and...



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