Shareholding Disclosure Rules and Regulations

There are shareholding disclosure rules in over 95 countries but there is no one single regulation governing these requirements, Instead they are part of an individual country’s legislation or regulatory rulebook.

These rules require investment firms to monitor and report complete and accurate disclosures of their share and derivative holdings to a relevant competent authority and/or issuer once certain parameters are met.

Shareholding Disclosure Service

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What is Shareholding Disclosure monitoring and reporting?

There are a number of different types of shareholding rules (whose application is different jurisdiction to jurisdiction) which serve different purposes.  The reporting deadlines, derivative inclusion, holding types and sanctions for non-compliance amongst other things all vary.  Below are the main categories of shareholding disclosure rules. 

  • Substantial shareholding rules (also referred to as major shareholding and long disclosures) – these are designed to provide transparency to the market, the issuer, and the relevant regulator, about positions that are being accumulated, provide information on who can vote at the company’s AGM or who has access to voting rights.
  • Short position disclosures– these disclosures are a tool for regulators to have transparency of those responsible for shorting an issuer. 
  • Takeover disclosures – more and more jurisdictions have introduced these disclosure requirements, which allow additional transparency whilst a company is under offer to ensure fair treatment of shareholders.
  • Issuer Requests– in some jurisdictions issuers or their investor relations representatives are able to legally request disclosure of your holdings in their issuer and the identity of other parties to that position. The aim is to provide the issuer with transparency of their shareholders. 
  • Sensitive Industry – this can often be a pre-approval requirement before you trade in a certain industry above a certain threshold. These are industries that a government want to protect.  These often include the financial industry, defence, and aviation but other industries are affected too.  Restrictions on foreign ownership of issuers can also apply.
  • Foreign Ownership – restrictions can be placed on the collective percentage all “foreigners” can own. Ownership over this level can include forced sale and sanctions.
  • Articles of Association– companies may include lower thresholds for disclosure within their company’s articles of association and include their own sanctions for non-compliance.

Shareholding Disclosure monitoring and reporting is a burden for many firms

Our Shareholding Disclosure Service includes a rules library and our automated monitoring and reporting system for 95+ jurisdictions accessed via a single user interface.

The easy-to-use platform, with its hosted customised rules engine, has been built by compliance experts, with users and managers with supervisory responsibilities in mind.

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“Our aim is to take away the pain and stress of shareholding disclosures, to streamline the process, to make compliance with the rules globally simple and make reacting to regulatory change a fast and simple experience.”

Angie Huff – Regulatory Advisory Director - Kaizen Reporting

What shareholding disclosure challenges are you facing?

For a conversation with one of our regulatory specialists, please get in touch.

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