By Opeyemi Issa InvestAdvocate

Lagos (INVESTADVOCATE)-Nigeria’s Securities & Exchange Commission (SEC) has announced that All share certificates must be dematerialised by January 01 2013.

This is contained in a Notice posted on the website of the Commission and obtained by www.investadvocateng.com.

“Notice is hereby given to the General Public and all Capital Market Operators that all share certificates are to be dematerialised by January 01, 2013. Dematerialisation refers to the elimination of physical certificates or documents of title representing ownership of securities,” the Notice said.

According to SEC, all share certificates dematerialised on or before January 01, 2013 shall be at no cost to the shareholder, but certificates dematerialised after this date shall be at a cost.

SEC affirmed that allotment of shares following public offerings shall henceforth be by electronic processes that will domicile shareholding directly with the Central Securities Clearing system (CSCS).

“This will facilitate speedy processing of offers and give investors simultaneous access to their shares for desired transactions,” SEC said.

The Commission further affirmed that however, should an allottee insist on being issued a share certificate, despite its disadvantages, a certificate shall be issued, in accordance with sections 146 and 147 (1) of the Companies and Allied Matters Act (CAMA).

“Investors are encouraged to contact their stockbrokers to assist them to acquire Clearing House Number (CHN) at the CSCS.

All Public Companies, Registrars and Stockbrokers are encouraged to inform shareholders, investors and other stakeholders to ensure the success of the dematerialisation exercise,” SEC said.

The advantages of dematerialisation and Electronic Public Offering according to SEC include, eradication of risk of loss of share certificate either by misplacement, theft or fire, reduction in the occurrence of cloning and forging of share certificates leading to loss of investment and elimination of cost of physical verification of share certificates.

Others are removal of delays and costs associated with dispatch of share certificates and facilitation of trading in shares.