Operational Information

CFCL Investment regulation – Denmark

Denmark CFCL

Reference

Service level
CFCL

Regulatory structure

Please refer to the Market infrastructure - Denmark for the complete information about the Regulatory structure.

Disclaimer

The information contained in the Holding Restrictions is based on the legal opinion obtained by CBL that was issued on 2 October 2020. CFCL believes the information to be correct as of that date but disclaims any responsibility as to the accuracy and completeness of the information after that date. In the case of discrepancy between the information provided by CFCL and the local laws and regulations, the latter shall prevail. The Holding Restrictions do not constitute legal advice and Clients should seek advice from independent professional counsel.

Clients are responsible for ensuring compliance with the holding restrictions and agree to indemnify and hold harmless, CFCL, for any loss, expense, liability, damage, or claims, whether direct or indirect, against or incurred by CFCL arising out of or resulting from such non-compliance.

Holding Restrictions – CSD Market – Denmark

Holding restrictions

Customers cannot hold Danish equities or Danish Investment funds via Clearstream, in either of the following circumstances:

  • The final beneficial owner is registered or tax resident in one of the below stated tax heaven countries; or
  • The customer or any other intermediary in the custody chain is registered or tax resident in one of the below stated tax heaven countries.

Tax Heaven countries

The countries that are currently considered as tax heaven countries in Denmark are the following:

  • American Samoa
  • The US Virgin Islands
  • Fiji
  • Guam
  • Palau
  • Panama
  • Samoa
  • Trinidad and Tobago
  • Vanuatu

Danish dividend distributions will be paid with the default rate of 27% withholding tax, but it is the customer`s responsibility and liability to ensure compliance with the investment restriction in Clearstream.

Disclosure requirements

Introductory information and categories

This section provides general information about the disclosure requirements for fund securities holdings with which Clearstream Fund Centre must, according to the information available at the time of the present publication, comply with each of the domestic markets and fund markets covered by the Disclosure Requirements. Fund securities that are held remotely are usually not disclosed by CFCL. A disclosure request received by CFCL regarding such a holding will be forwarded to the relevant client without assessing its validity and the CFCL Client shall handle the request on a voluntary basis.

Disclosure Requirements are only available for those countries where CFCL has a link to the respective domestic market or direct access to local domiciled funds that are held in Clearstream’s name on the register.

For fund securities holdings where CFCL has no such link or direct access to the register, clients must be aware that local laws might provide for mandatory disclosure. A disclosure request in this regard will be forwarded to clients without assessing its validity. Clients commit not to unreasonably withhold their consent to such a request and agree to indemnify CFCL for damages resulting directly from non-compliance with mandatory local disclosure requirements.
In most cases, the obligation to disclose is based on the domestic equivalent of a Companies Act, relevant investment funds act or anti-money laundering act and covers all security types.

In some instances, the obligation to disclose is based on stock exchange laws or regulations and only applies to listed domestic and foreign securities.
The Disclosure Requirements do not constitute legal advice and the Clients should seek independent professional advice in relation to fund securities deposited with CFCL, especially as, for those jurisdictions in which no disclosure obligation falls on CFCL, there may be separate disclosure requirements that apply directly to clients of CFCL, shareholders and beneficial owners.

Please note that CFCL is not always given comprehensive information or advised of changes affecting local disclosure requirements.

It remains the sole responsibility of the Client to ensure compliance with local disclosure requirements. If a requirement is not met, it is the Client who will be liable to any related penalty. Clients are therefore advised to seek independent legal advice on the existence and interpretation of local disclosure requirements.

In the case of a discrepancy between the general information contained in this document and the information provided by CFCL for a specific market, as applicable (irrespective of whether this information has been obtained from an agent of Clearstream Fund Centre, or, as the case may be, a foreign regulator of a branch of CFCL), the information provided by CFCL for the specific market as applicable, shall prevail.

N.B.: In all countries, if it is suspected that a disclosure obligation has been breached (for example, that a threshold of holdings under custody has been crossed without being reported), the regulators and the authorities may have the power to investigate. Moreover, in all countries, disclosure obligations might be triggered by enforceable judgements of the competent jurisdiction of the country in question.

Disclosure categories

Clearstream Fund Centre classifies disclosure scenarios according to the following market categories:

Category 1

Markets where disclosure by Clearstream Banking as a custodian of Clearstream Fund Centre to issuers, investment fund managers and/or to regulators or market authorities is mandatory under applicable law;

Category 2

Markets where disclosure by Clearstream Banking as a custodian of Clearstream Fund Centre of account holders to issuers, investment fund managers and/or foreign regulators or market authorities is a legal obligation in respect of securities in specific circumstances;

Category 3

Markets where there is no obligation for Clearstream Banking as custodian of Clearstream Fund Centre to disclose account holders to issuers, investment fund managers and/or regulators, notwithstanding any disclosure requirement falling directly on clients of Clearstream Fund Centre, shareholders and/or beneficial owners or notwithstanding disclosure necessary to obey an enforceable judgement of the country in question.

Disclosure requirements – CSD Market – Denmark

Disclosure Category: 2

An obligation may fall on Clearstream Fund Centre S.A. (“CFCL”), as a custodian, to disclose details of its account holders to issuers, to central banks and/or to regulators on request in certain specific circumstances.

Consent

Clients are hereby deemed to consent to disclosure and to the appointment of the requestor (for example, but not limited to the issuer or its agent) as their attorney-in-fact, under power of attorney, to collect from Clearstream Fund Centre such information as is required to be disclosed. Clients not willing to give this consent cannot hold such fund securities in their account with Clearstream Fund Centre.

Disclosure requirements

The Financial Supervisory Authority and the issuing company must be informed immediately after a transaction if:

  • An investor’s shareholding reaches 5%, 10%, 15%, 20%, 25%, 33.3%, 50%, 66.7%, 90% or 100% of a company’s share capital or voting rights;
  • The holding falls below any of the aforementioned thresholds.

Reporting obligations for large holdings are imposed equally on foreign investors and local investors. Shareholders are responsible for including the shares owned by the entities they control, including pledged shares that do not include rights that the investor intends to exercise. Failure to report substantial shareholdings will result in a fine. According to the Reporting Rules for Shareholders of the Danish FSA, reports must be submitted by fax as soon as possible, and latest by the end of trading day. Euronext Securities Copenhagen operates a public register of shareholders as of 15 December 2014. Registrations should be made in the public register by issuing companies when shareholders reach or exceed holdings of 5% of the share capital or the voting rights. Crossing the thresholds of 5%, 10%, 15%, 20%, 25%, 33.3%, 50%, 66.7%, 90% or 100%, in either direction, must be also registered. Changes in substantial shareholdings must be registered within 2 weeks. According to Directive (EU) 2017/828 of 17 May 2017 amending Directive 2007/36/EC with regard to the encouragement of long-term shareholder engagement (SRD II), EU/EEA Member States must ensure that companies have the right to identify their shareholders that hold more than a particular percentage of shares or voting rights. Such a percentage shall not exceed 0.5%. Denmark has not set a threshold.

Background and legal basis

Directive (EU) 2017/828 of 17 May 2017 amending Directive 2007/36/EC with regard to the encouragement of long-term shareholder engagement (the second shareholder’s rights directive “SRD II”) has been transposed into Danish Law (L157 of 2018/2019) amending the Companies Act, the Capital Markets Act, the Financial Business Acts in 4 April 2019 (SDR II Law). Disclosure is required to the issuer and to the Danish Financial Supervisory Authority (FSA). Note: The FSA provides a standard form for disclosure of beneficial owner voting rights (see oasm.dfsa.dk/uk/issuer.aspx).
The basis for the disclosure obligation is the Consolidated Act no. 214 of 2 April 2008, of the Securities Trading, etc. Act, further amended by amendment numbers 515 and 517, both of 17 June 2008. The act came into force on 1 July 2008.
Notification must be made based on compliance with the rules of the Danish Securities Trading Act and the Danish Companies Act (see http://www.finanstilsynet.dk/).

The disclosure obligation falls on the shareholder.

Please refer to Disclosure Requirements – Denmark for complete information on disclosure requirements for Denmark.

Disclaimer

The information contained in the Holding Restrictions is based on the legal opinion obtained by CBL that was issued on 2 October 2020. CFCL believes the information to be correct as of that date but disclaims any responsibility as to the accuracy and completeness of the information after that date. In the case of discrepancy between the information provided by CFCL and the local laws and regulations, the latter shall prevail. The Holding Restrictions do not constitute legal advice and Clients should seek advice from independent professional counsel.
Clients are responsible for ensuring compliance with the holding restrictions and agree to indemnify and hold harmless, CFCL, for any loss, expense, liability, damage, or claims, whether direct or indirect, against or incurred by CFCL arising out of or resulting from such non-compliance.

Fees

For some Denmark domiciled funds, customers will be charged 6 bps off the value per order, with a floor/minimum commission of 125 EUR for the trading of some Denmark domiciled funds.

This fee is charged by the local order taker and the fees are passed on to our customers.

The fee will be chargeable on a per trade basis and reflected in the settlement fees. 

Above pricing structure will apply for some Denmark domiciled funds held with certain asset management companies.

Fees will be charged in EUR.

Further information

For further information, customers may contact Clearstream Customer Service Vestima Team or their Relationship Officer.