Public Notice on E-Public Offerings/Dematerialization
April 19, 2012 / Securities & Exchange Commission
Notice is hereby given to the general public and all capital market operators that all share certificates are to be dematerialized by January 1, 2013. Dematerialization refers to the elimination of physical certificates or documents of title representing ownership of securities.
All share certificates dematerialized on or before January 1, 2013 shall be at no cost to the shareholder, but certificates dematerialized after this date shall be at a cost.
Accordingly, allotment of shares following public offerings shall henceforth be by electronic processes that will domicile shareholding directly with the Central Securities Clearing system (CSCS).
This will facilitate speedy processing of offers and give investors simultaneous access to their shares for desired transactions.
However, should an allottee insist on being issued a share certificate, despite its disadvantages, a certificate shall be issued, in accordance with sections 146 and 147 (1) of the Companies and Allied Matters Act (CAMA).
Investors are encouraged to contact their stockbrokers to assist them to acquire Clearing House Number (CHN) at the CSCS.
All public companies, registrars and stockbrokers are encouraged to inform shareholders, investors and other stakeholders to ensure the success of the dematerialization exercise.
Dematerialization and electronic public offering have far reaching advantages, which include:
1.Eradication of risk of loss of share certificate either by misplacement, theft or fire.
2. Reduction in the occurrence of cloning and forging of share certificates leading to loss of investment.
3. Elimination of cost of physical verification of share certificates.
4. Removal of delays and costs associated with dispatch of share certificates.