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Corporate actions

Corporate actions are such actions that refer to a split or merger of stocks, mergers, acquisitions, takeovers and other changes in status (so called capitalization corporate actions), payment of dividends, payment of interest and principal in the case of bonds (so called benefit distribution corporate actions), as well as the privileges (ex. share purchase preemption rights) to which the shareholder is entitled (so called privileged corporate actions). Most corporate actions in the Republic of Macedonia are regulated with the Law on trade companies.

 The system of the Depositary supports the following corporate actions:

  • Split of ISIN numbers – this corporate action is carried out in the event of a split of the company to two or more joint stock companies or in the case of a spin off. This technical operation which is carried out in the Depositary is based on the possibility provided in article 517 paragraph 3 of the Law on trade companies. The condition for the implementation of this corporate action is for the change to be registered Central Registry – Registry of trade companies and other legal entities.
  • Merger of  ISIN numbers – this corporate action is carried out in the event of a merger of two or more companies into a new company or in the event of merging with an existing company. This technical operation which is carried out in the Depositary is based on the possibility provided in article 517 paragraph 2 of the Law on trade companies. The condition for the implementation of this corporate action is for the change to be registered in the Central Registry – Registry of trade companies and other legal entities.
  • Stock split – corporate action of splitting the stocks is carried out in accordance with the decision made by the Assembly of Shareholders pursuant to article 276 paragraph 1 of the Law on trade companies. The existing number of stocks distributed to the total number o f stockholders is increased proportionately as per the decision.
  • Merger of stocks  - corporate action of merging of stocks is carried out in accordance with the Decision made by the Assembly of Shareholders pursuant to article 276 paragraph 2 of the Law on trade companies. The existing number of stocks distributed to the total number of stockholders is proportionately reduced as set in the Decision.
  • Assimilation of ISIN numbers – this corporate action is carried out if the issuer makes a decision to attach equal rights and conditions to several types of issued securities in such manner that they should be maintained under the same ISIN number. On the basis of a decision made by the Assembly of shareholders, the issuer may decide to convert one type of shares into another.
  • Cancellation of stocks– corporate action carried out in accordance with the Law on Trade Companies in a procedure of cancellation of treasury stocks or cancellation of stocks held by stockholders who, in a status change following a split, have expressed their intention to convert their stocks into a share of a newly set up company. This corporate action leads to decrease of the basic capital of the company, as a result of which it is subject to an entry in the Central Registry – Registry of trade companies and other legal entities, before it is implemented in the Depositary.
  • Blocking/deactivation of securities- corporate action which is carried out when there is no longer a legal basis of the existence of a security. As regards bonds it is the maturity date, while with respect to stock, it is one of the basis for the termination of the issuer– joint stock company, as specified in  article 452 of the Law on Trade Companies.
  • Increase of basic capital- corporate action carried out on the basis of the decision of the Assembly of shareholders pursuant to the Law on securities and the Law on trade companies. The condition for the implementation of this corporate action is the registration of the change with the Central Registry – Registry of trade companies and other legal entities, while the securities issue should be approved by the Securities and Exchange Commission.
  • Decrease of basic capital- corporate action carried out on the basis of the decision of the Assembly of shareholders pursuant to the Law on trade companies. The implementation of the corporate action in the Depositary is preconditioned by the registration in the Central Registry – Registry of trade companies and other legal entities.