New Law On Dematerialised

On 6 April 2013 Luxembourg enacted a new law concerning dematerialised securities and amending a number of existing Luxembourg laws (the "New Law"). The New Law was published in the Mémorial A (the Luxembourg Official Gazette) N° 71 on 15 April 2013.

With the coming into force of this New Law, Luxembourg companies will now have the option of issuing debt or equity securities in dematerialised form while foreign companies will have the same option, but only for debt securities which are governed by Luxembourg law. The possibility to issue debt and equity securities in bearer and registered form remains. Unlike similar legislation in other jurisdictions, the New Law is not drafted so as to result in the eventual abolition of bearer securities.

Below, we take a closer look at some of the specific provisions of the New Law as well some of the important changes it will introduce to existing Luxembourg laws.

1. ISSUANCE OF DEMATERIALISED SECURITIES

   1.1. Necessary steps for the issuance of dematerialised equity securities

   Prior to issuing dematerialised equity securities, an issuer must:

   amend its articles of incorporation or the management regulations of the issuer, as applicable, to provide for the issuance of dematerialised securities. take the necessary steps to ensure the entire issue of dematerialised securities of the same kind are recorded with a single clearing house (l'organisme de liquidation) or single central securities depository (le teneur de compte central), and publish in a national newspaper and on its website (if it has one), the name and address of the chosen clearing house or central securities depository. Each issuer who is registered with the Luxembourg Trade and Companies Register (Registre de Commerce et des Sociétés de Luxembourg) must file an extract for the purposes of publication in the Mémorial, Recueil des Sociétés et Associations which indicates the name and address of the clearing house or central securities depository.

   1.2. Necessary steps for the issuance of dematerialised debt securities

   Each issuer who wishes to issue dematerialised debt securities must take the necessary steps to ensure the entire issue of dematerialised securities of the same kind are recorded with a single clearing house or single central securities depository.

2. CONVERSION INTO DEMATERIALISED SECURITIES

   2.1. Necessary steps for the conversion of dematerialised securities

   An issuer who wishes to convert equity securities that it has issued into dematerialised securities must amend its articles of incorporation or management regulations in order to set out:

   the right of the issuer to issue dematerialised securities; the securities which shall be subject to the conversion; the mandatory or optional nature of the conversion; the conversion procedure; and if the conversion is mandatory, the conversion period and the penalties for non-submission of the securities for dematerialisation within the conversion period (which may not be less than two years). Such issuer must also take the necessary steps to ensure the entire issue of dematerialised securities of the same kind are recorded with a single clearing house or single central securities depository.

   2.2. Conversion Process

   2.2.1. Conversion of bearer securities

   Bearer securities, which are in...