Investors that have neglected their Central Depository and Settlements accounts in the last two years will be unable to access them from 1 March 2019 as new regulations – CDS Accounts Dormancy Rules and Procedures – take shape.
The new regulations are “intended to safeguard investors’ holdings in the accounts.” They were formulated in May 2018 by the Central Depository and Settlements Corporation Limited and approved by the Capital Markets Authority.
“CDSC granted a grace period of nine (9) months beginning June 1st 2018 to February 28th 2019 before the declaration of dormancy is effected. Pursuant to the Dormancy Rules, CDS accounts (Individual or corporate, Local or Foreign) with no activity for a continuous period of 24 months as at February 28th 2019 will be declared dormant on March 1st 2019,” says CDS Corporation in a statement.
A CDS accounts is a mandatory requirement for an investor transacting in Kenyan stock market. Reactivation of dormant account will require one to present duly filled re-activation requests and identification documents to their stockbrokers or Central Depository Agent.
Additionally, the CDSC is in the last stage of unveiling a new system. It is conducting a one-month data cleanup exercise before the overhaul.