A minor change to wording introduced within the new Civil Code effective January 2014 has affected clarity of interpretation of the rules concerning securities registration in the Czech Republic.

Securities registration is newly governed by the Civil Code, stipulating that dematerialised securities are registered in the name of the account owner and that the owner of the securities account is deemed to be the owner of dematerialised securities deposited therein.

“The latter is another wording of the ‘unless proven otherwise’ which was previously embedded into the Capital Markets Act,” explains Vit Cermak, head of GSS & FI Czech Republic at Raiffeisen Bank International. “The custodians associated within the Capital Markets Association (AKAT) jointly approached the Czech National Bank, which eventually reconfirmed the current market practice.”

Expectations for 2015 include the CSD launching its own Swift connectivity and preparing for the introduction of a CCP, which is planned for May. Use of Swift communication for local securities is planned for a later stage and will be dependent on the demands of market participants.