Profils du marché

Bratislava Stock Exchange (BSSE)
BSSE is a joint stock company founded in 1991 with the main shareholders being  MH Manazment,(successor of the National Property Fund of Slovak Republic) the largest of the Slovak financial institutions, investment, brokerage and insurance companies. Trading commenced in 1993 and activity is governed by the Stock Exchange regulations. The market is split into the Listed Market (comprising the Main Listed Market and Parallel Listed Market) and the Regulated Free Market. Following the MiFID rules implementation, BSSE has launched a Multilateral Trading Facility of which it is the sole organiser.

Trades in listed and unlisted securities are executed through the Electronic Stock Exchange Trading System (ESETS = EBOS). The system is based upon the active placing of orders to buy and sell into a computer by each member individually. Therefore each Stock Exchange transaction is closed directly between members, who are licensed brokers. Members place the orders to buy and sell by means of EBOS workstations, which are located at their offices and have an online connection to the Stock Exchange's central computer. Members are allowed to close price-setting transactions, negotiated deals and repo transactions. In addition, they can execute a takeover bid.

Monday to Friday: 10:30- 15:30

ISIN (International Securities Identification Numbering): Yes, for all publicly traded instruments including T-Bills and for all book-entered securities registered with the CSD (CDCP - Central Securities Depository of the Slovak Republic jsc).

Other: Local identification for materialised securities beginning with LP followed by ten digits. LP stands for paper-form security.

Ministry of Finance (MOF): responsible for the legislative framework of the securities market. The MOF issues government bonds and treasury bills through a Debt and Liquidity Management Agency (ARDAL).

National Bank of Slovakia (NBS): performs the functions of the central bank and supervises, monitors and regulates banks, the capital market and the insurance sector making decisions regarding the rights, protected interest and duties of legal and natural persons in these sectors. It also liaises with the Ministry of Finance and other supervisory bodies in the areas of financial policy formulation and implementation.

All instruments are issued in bearer book-entry form, except some physical equities. Physical securities are not allowed for trading on the Stock Exchange.

Minimum price variation unit is EUR 0.01

OTC trades are negotiated with counterparties outside the BSSE. Turnaround trading is possible through the BSSE system.

There are two settlement methods to settle OTC deals.

1. DVP Method
Securities and cash settle on a real-time, true DVP basis via T2S (system is operated by Central Securities Depository of the Slovak Republic CDCP (CSD).

2. Non-DVP method
Securities and the cash move separately. Securities are transferred via CSD (free of payment) while cash moves in the local cash clearing systems. Participants settle over-the-counter trades individually.

Settlement of non-listed securities:
OTC transactions with securities, which are not admitted for trading at the Bratislava Stock Exchange, are settled free of payment or against payment through the CSD without the involvement of the Stock Exchange. Transactions are settled based on counter instructions (so called semi-orders) input by two CSD members.

Partial settlement is not allowed for OTC trades.

Book-Entry: The BSSE initiates securities movements at CSD on T+2 (standard settlement cycle). CSD as an ancillary system to TARGET2-SK, initiates transfers of cash on T2S DCA accounts of clearing banks based on a "Debit mandate for AS settlement".

• T Securities trading: BSE submits trading results to all members who participated in that day.
• T or T+1: Final Confirmation of trade results or claim of BSE members if trading results do not correspond with a trade, BSE sends settlement orders to CDCP for Clearing & Settlement.
• T+2: from 09:00 CDCP blocks securities, debits T2S DCA accounts of clearing banks
• T+2: 13:00 deadline for on-exchange trades for submitting cash liquidity on buying member’s T2S DCA account
• T+2: 16:00 deadline for submitting cash liquidity on buying member’s T2S DCA account (direct trades - OTC)
• After release of payments from CDCP account with T2S to selling CDCP members' accounts with T2S. Move of securities to buying CDCP members.
• Settlement confirmations.
• T+2 by 16:00 DVP Settlement Closure
• T+2 by 18:00 FOP Settlement Closure

T-Bills Settlement
Same as above 

Physical: Negotiated between counterparties.

OTC transactions are settled via systmem of CDCP

Short selling is not permitted, BSSE rules prohibit it. Effective November 1, 2012, the relevant authority must be notified by investors of the short position of shares and government debt when the position reaches or falls below the levels specified in the regulation. The relevant authorities are the local Financial Supervisory Authorities (FSAs).

The short positions of shares must also be disclosed to the public by posting information on the local FSA's website when a position reaches or falls below the specified levels. 

For full information of the new regulation and reporting requirements please visit the European Securities and Markets Authority website at http://www.esma.europa.eu/.

CDCP Settlement Division facilitates trade settlement. 

The National Bank of Slovakia (NBS) 
Clean-cash clearing is processed by the Slovak Interbank Payment System (EUROSIPS run by the NBS). In addition local banks have access to TARGET 2 clearing system.

The Centralny depozitar cennych papierov SR, a.s. (Central Securities Depository of the Slovak Republic) (CSD) is the central register for all dematerialised stocks and bonds. The CSD became fully operational on October 1, 2004 and the new CSD system was also launched on that date. This system was used until July 2007 when it was replaced by the BSSE clearing and settlement system. Since 6 February 2017 (migration to T2S), clearing and settlement takes place in the new, T2S compliant system of CSD – IS CDCP.

The scope of CSD's activities covers the performance of the following activities:

• registration of book-entered securities and immobilised securities in the issuer's registers
• registration of owners of book-entered securities on owner's accounts
• registration of changes in owner's account and registration of changes in the CSD member's client accounts
• assignment, changes and cancellation of ISIN
• provision of services to members of the CSD, issuers of securities, stock exchange and foreign stock exchange
• providing for and organising a system for technical data processing regarding keeping of registers
• administration of the list of shareholders for physical registered shares.

It also provides settlement and clearing of stock exchange transactions in investment instructions and clearing and settlement of OTC transactions in investment instruments. Provision of clearing and settlement of transactions means organising and operating a system for clearing and settlement of transactions in investment instruments for at least three participants of the settlement system.

NCDCP
Effective November 1, 2014, a CSD, named Národný centrálny depozitár cenných papierov a.s. (NCDCP), was established with an equity capital of EUR 8.4 million. The new CSD commenced its services  in June-2016. Since October 2016, NCDCP is authorized to perform the activities of clearing and settlement of stock exchange trades. The operations of the current CSD will remain unchanged. The new and existing CSDs will operate in parallel.

BIS is an international organisation which fosters cooperation among central banks and other agencies in pursuit of monetary and financial stability. The Committee on Payments and Market Infrastructures (CPMI) uses three common structural approaches, or models, to categorise the links between delivery and payment in a securities settlement system.

Model 1 applies - a system in which there is a simultaneous transfer of securities and associated funds from the buyer to the seller. All transfers occur on a trade-by-trade (gross) basis with all transfers made via book entry. All transfers are final.

Book-Entry: via the Central Securities Depository. Registration takes place at the same time as settlement itself i.e. it occurs automatically upon crediting of securities in favour of the securities account established at the CSD (in the name of person or legal entity). There is no specific registration process.

Physical: via local commercial banks - as such the physical securities are held in the vaults of commercial banks.

There is neither a special Registrar nor a specific registration process established in the market.

Registration is automatic and occurs on the settlement day.

Share holdings may be required to be disclosed by the beneficial owner, particularly when holdings reach or exceed prescribed disclosure limits. Investors must ensure that they comply in full by reporting such holdings to the appropriate organisations for this market, within the timeframe required. If you have any questions regarding this issue we encourage you to consult your legal counsel. 

Failure to comply with reporting requirements may lead to penalties and/or other sanctions.

Ownership disclosure is required at 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75% thresholds. A take-over declaration is required when ownership of a company exceeds 33% threshold.

There are no formal buy-in procedures. If in case of BSSE transactions, securities cannot be delivered on SD, the seller has three days to meet settlement obligations. If a buyer cannot pay for a trade, the BSSE Guarantee fund is drawn on. The failing party is sanctioned. This procedure applies to on-exchange trades only. There is no similar procedure for negotiated trades or OTC settlement failures.

Introduced by law (Act on Securities and Investment Services), however market practice has not yet been established.

BSSE Guarantee Fund (for on-exchange trading)
BSSE keeps a Guarantee Fund to which Stock Exchange members financially contribute. The Guarantee Fund of the Stock Exchange serves to cover the members' financial obligations and claims resulting from Stock Exchange transactions. The provisions of the Rules of the Guarantee Fund apply only to on-exchange (anonymous) transactions in securities. The Guarantee Fund resources can be only used to cover the members' financial obligations resulting from such electronic order book transactions and block transactions closed on the Stock Exchange which cannot be settled due to various reasons. 

Direct trades and repo trades are not subject to financial coverage by the Guarantee Fund's resources.

Investment Guarantee Fund
In compliance with the Act on Securities and Investment Services no. 566/2001 Coll., Investment Guarantee Fund was established in 2004. The fund is a joint-stock company, registered in the Commercial Registry and is funded by the obligatory contributions of all licensed securities brokers to provide compensation for inaccessible client assets received by a stock brokerage firm.

Stock Brokerage firms are obliged to pay into the guarantee fund. It only guarantees the assets of physical persons and non-profit organisations held with the broker. There is no form of juridical protection for the assets of the legal entities in place.

The Act on Prevention against Legalization of Resulting from Criminal Activity No. 297/2008 Coll. is considered as a basic Anti Money Laundering act. The unit responsible for monitoring AML are the Financial Police - part of public police which acts independently. Financial Regulators have responsibility for AML, especially the control functions covering AML procedures, methodology and other.

This is an FII market. Please contact your RBC Investor Services' Client Manager before making portfolio investments.

Account opening procedures vary depending on the tax residence of the underlying investor. 

Legal title of the securities is linked to the investor account. The account holder must assign a local agent (and member of the CSD) to open, maintain and operate the account on a day-to-day basis. As the account opening process is lengthy it is common market practice to establish quasi-nominee accounts at CSD (i.e. an account in the name of RBC Investor & Treasury Services). The subcustodian is responsible for subaccounting. Although nominee ownership was not legally recognised until May 2, 2007 (when the Amendment of Act on Securities and Investment Services was published in Collections of laws and thereby introduced the so called "holders account", which is actually the nominee/omnibus accounts effective as at November 1, 2007 for the CSD, and May 1, 2008 for the other market participants), it is the most common form of ownership for foreign investors.

Foreign investors require prior NBS approval to purchase more than 10%, 20%, 30% and 50% of a bank's, insurance company's, asset management company's and/or broker dealer's shares.

Funds can be repatriated freely. Commercial banks can quote their own rates to clients on the interbank foreign exchange market.

EUR is freely convertible currency. There are no restrictions imposed on FX. Most of the FOREX and derivative products offered internationally are also available on the Slovak market. Market trading hours: 08:30 – 16:30.

On January 1, 2003 operation of the payment system was taken over by the National Bank of Slovakia (NBS) from the Slovak National Clearing Centre which had operated the SIPS (the Slovak Interbank Payment System) system since 1993. NBS thus became the operator and concurrently the settlement agent for SIPS. This change was motivated by an effort on the part of the NBS to enhance the effectiveness and safety of the payment system, using the most advanced information technologies as a basis to build up the RTGS (Real Time Gross Settlement) system under Slovak Republic conditions. 

By its accession to the euro area, the Slovak Republic joined TARGET2 payment system. Existing SIPS System and its technologies became a platform for the processing and clearing of retail payments in the form of what is called the Ancillary System to TARGET2. The RTGS functionality is not supported in SIPS any more. The new SIPS EURO system is a so-called multilateral positions calculation system, which is settled twice a day on RTGS accounts in the TARGET2 system. 

Slovak component of TARGET, TARGET2-SK serves primarily for the settlement of transfers of large volumes and the accounts maintained in it are simultaneously accounts for the monitoring of minimum reserves of banks. The main participants of TARGET2-SK are some 30 financial entities and three ancillary systems (SIPS EURO system, Central Securities Depository and First Data Slovak Republic –payment card transactions clearer). The contractual partner and the system provider is NBS.

In Slovak Republic the option for an overdraft on the cash account does exist, however it is based upon the precedent agreement, where the overdraft level is usually stated. If this level is exceeded by a significant value, then some of the outgoing payments will not be released, as either a zero balance or the maximum overdraft facility level (+/- tolerance which is based in general on the overdraft facility level) has to be met. Therefore the market does not permit overdrafts on cash accounts in the absence of an overdraft facility.

Entitlement for dividend is based on settled (not traded) position. Entitlement (a decisive or a record) date may not be determined for a date earlier than the fifth day following the date of a general meeting including market practice not to define such date later than the 30th day from the date of a general meeting.

Slovak corporations decide on paying dividends usually on an annual basis during their general meetings. Annual General meetings are held mostly around April – June each year. Dates and any special procedures are set at the AGM of the issuer. Dividends are paid within 60 days of the entitlement date given at the general meeting. There is no fixed payment date.

Quarterly, semi-annually or annually, at the discretion of the issuing company and according to the issue terms.

Government Debt: Liquidity Agency (ARDAL) performs functions of the principal paying agent on behalf of The Ministry of Finance – the Issuer. It pays interests and repays principal to investors. ARDAL transfers the interest to the custodians and their clients on the basis of data supplied by the CSD. The amount is credited on the interest due date. Repayment of principal amount of government bonds is effected in accordance with the procedure of interest payment.

Treasury bills: ARDAL acts as a principal paying agent in redemption of Treasury bills issued by Ministry of Finance. ARDAL transfers to custodians the principal amount on the payment day.

Corporate bonds: registration is performed by the account holder on record date, when Custodians send all necessary documentation to the paying agent and informs him about the details of the beneficiary. Payment is not contractual; accounts are credited with the income amount only after actual receipt from the paying agent.

Dating conventions are set in the issue conditions, which are published at the date of the issue.

Securities holders are entitled to receive interests (maturities) according to the settled position on record date; ex-date is usually Record date +1. Record date is usually on coupon date -30 working days for Corporate bonds and coupon date –one working days for Government bonds.

365 day basis

The processing of corporate actions is not standardised. Decision on corporate action is made at a general meeting. Terms of corporate action are announced in the local press afterwards, specifying record date, payment conditions, documentation requirements, and price. The issuer himself can freely decide all conditions of the corporate action. Claims are handled in Slovak Republic only on a best effort basis; there are no standard market claims procedures established on the market.

Rights and entitlements are protected on settled positions. Rights are transferable but not tradable.

Voting is permitted through the presence of the shareholder or a proxy at a generalmeeting or newly as correspondence voting & voting via electronic means.

It has been abolished in the case of shares admitted to trading on the regulated marketafter implementation of EU Directive on Shareholders Rights on 1 December 2009.

Published in daily newspapers, on the internet and the weekly stock exchange bulletins. AGMs and OGMs are announced 30 days in advance, EGMs 15 at least days prior to the date of the meeting.

Available on request.

Available on request.

Persons attending the general meeting have to submit appropriate Powers of Attorney and account holder's Certificate of Incorporation.

Partial voting is not recognised. Split voting must be discussed in advance with the issuer as there are no fixed market rules that would apply.

Dividends are tax exempt prior to January 1, 2018 in practice.

Effective January 1, 2018 in practice, Dividends paid to taxpayers who are resident in non-treaty countries will be subject to tax at a rate of 35%. Dividends paid to individuals who do not reside in non-treaty country will be taxable at a rate of 7%.

Interest on government bonds and treasury bills paid to non resident investors is exempt from withholding tax.

Interest on non-government bonds is exempted from withholding tax, if paid to non-resident, as well. 19% tax is applied to interest income unless reduced by a double taxation treaty (or according to DTT mostly reduced to 0% if applicable).

The taxation of income derived from Slovak Corporate bonds (including Bank bonds) owned by Foreign investors will be subjected to WHT beginning  January 1, 2023, while 3 different tax rates could be applied based on the final beneficial owner status:

• 35% WHT – for Investors from Tax Heaven countries or undisclosed positions,
• 19% WHT – for Investors from White listed countries, with full disclosure
• Double Tax Treaty (DTT) rate.

Exempt

In case of CGT must client lodge a Tax declaration, if CGT is not exempt based on DTT agreement.

But CGT is not covered via custodians, client must handle it alone.

Exempt is definitely not correct – rathter state sometnig more neutral – e.g. Based on DTT and individual client situation… or something like that

A list of Double Tax Treaties is available here: https://www.mfsr.sk/en/taxes-customs-accounting/direct-taxes/income-tax/international-taxation/double-tax-treaties/

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Slovak Republic Calendrier des fêtes

• Bratislava Stock Exchange bsse.sk
• National Bank of Slovakia nbs.sk
• Ministry of Finance finance.gov.sk
• Ministry of the Economy economy.gov.sk
• Central Securities Depository cdcp.sk
• National Central Securities Depository www.ncdcp.sk
• Debt and Liquidity Management Agency www.ardal.sk