The Union des Entreprises Luxembourgeoises (UEL) has reminded its members that from 18 February 2018, companies that have not chosen a depositary must cancel bearer bonds and their corresponding value must be deposited at the Caisse des Consignations.
The warning came after the UEL found that very few investors have so far taken the step of presenting themselves at a bank to immobilise the shares, as is provided for in the Act of 28 July 2014 concerning the immobilisation of bearer shares and units. This means that even if the companies have done their job, they are still potentially at risk.
These companies must identify as quickly as possible how many shares issued have not been presented by shareholders and, by way of an accounting procedure, determine the value of these shares, specifically assessing the value of the company concerned and dividing it by the number of actions.
The Caisse des Consignations only accepts cash. Unless they have the counter-value on their balance sheet, the companies concerned will have to sell some of their assets to deposit X% of shares not presented. Beyond the cost, there is a certain economic risk: the capital of these companies may fall short of the minimum capital required by law and, in failing to reconstitute their capital, they will need to be place in liquidation.
Two options are available in the short-term to resolve the problems:
- Contact the shareholders (if identified) as soon as possible to prevent the consequences at their level, ie dividend losses, ownership loss, nd ask them to present themselves at a depositary to immobilise their shares
- Create a register of registered shareholders and identify each shareholder with their stake.
