The Icelandic Securities Depository Ltd recently started business making it the first electronic registrar of securities in the country.

Foreign investors have viewed the absence of electronic registration as an obstacle to their potential involvement in the Icelandic securities markets. This attitude has encouraged Icelandic issuers to participate in the new process. The first transaction took place in June with the registration of shares in the Icelandic prosthetic manufacturer Ossur Ltd. Thirteen issues have been registered electronically and 18 more have been signed up.

Trading with issues that have been registered electronically can only take place in dematerialized form. All transactions relating to securities that have been registered electronically, must be recorded with the Securities Depository if they are to enjoy legal protection.

All communication between investors or issuers and the Securities Depository must go through an intermediary. According to the Icelandic Act on Electronic Registration of Securities Act 131/1997, several parties can act as intermediaries, including all those that are entitled to provide securities services in Iceland. These include securities companies and brokerages. The Ministry of Commerce can also allow any EEC securities service providers to act as intermediaries (providing they have notified their local regulator of their intention to provide securities services in Iceland).

For further information on this topic please contact Gunnar Sturluson at Logos by telephone (+354 568 09 00) or by fax (+354 568 09 09) or by e-mail ([email protected]).

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