Safe custody business

As defined in § 1, par. 1, sentence 2 №. 5 KWG, safe custody and administration of securities for others. – The two constituent elements of safekeeping and administration are optional in relation to each other; each type of business alone constitutes the custody business within the meaning of the KWG: anyone who holds securities in safekeeping within the meaning of this provision is engaged in the custody business, even if he does not administer these securities; and anyone who administers securities within the meaning of this provision is engaged in the custody business, even if he does not hold these securities in safekeeping. – Safekeeping is the granting of space and the assumption of custody. The mere granting of space without custody is space rental or space lending, not custody business. – Administration is, in the broadest sense, the ongoing safeguarding of the rights arising from the security. It includes, in particular, collection activities – such as the separation of due interest coupons and dividend coupons, the collection of their countervalue, the request for new interest coupons and dividend coupons and the exercise of subscription rights, as well as the collection of the countervalue at maturity -, notification and auditing duties and, if a corresponding written power of attorney has been granted, also the exercise of the right to vote on orders. – See aberdepot, outsourcing, back-off area, custody account, custody receipt, custody risk, outsourcing risks, street name, asset manager, ancillary securities services, intermediate custodian.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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