Signing a Participation Agreement
An entity which intends to keep securities accounts or omnibus accounts and applies for direct participation in KDPW submits to KDPW an application available on the KDPW website (form U1 EN, form U1 PL), which should contain the following:
Note: The declaration referred to in the third indent is not required from an entity seeking participation to the extent of holding an omnibus account or a securities account maintained in KDPW which intends to operate in the depository system via an account operator. In that case, the application should include a declaration to the effect of appointing a named direct participant as the entity’s account operator. Furthermore, where the entity is seeking participation status type of Foreign Custodian, the application should include a declaration to the extent that the entity is familiar with the provisions of the Personal Income Tax Act referred to in the Rules and is aware of the obligations of natural persons under those provisions.
- the type of participant status – in this case, direct participant;
- the type of activities and the type(s) of participation status relevant to the activities which the applicant intends to perform, according to the classification defined in § 11 subparas. 1-4 of the KDPW Rules (hereinafter “Rules”). Note: Where the applicant applies for the participation status type of Representative (Settlement Agent), indicate the participant or the entity that is not a participant, for whom the applicant intends to perform activities within this scope;
- a declaration stating that the applicant is familiar with the rules presented on the KDPW website relating to sending and receiving of declarations and information in electronic form, applied in relations between KDPW and direct participants, and has understood the terms and conditions which need to be met by the applicant as a direct participant according to the provisions of § 24 subpara. 3 of the Rules.
According to § 20 of the Rules, the following documents should be attached to the application:
- a copy of the company statute or articles of association and a valid copy or excerpts from the relevant company register;
- a copy of the brokerage licence or the licence to conduct other activities related to securities trading or registration, if such licences are required by separate legal regulations. For foreign investment companies conducting brokerage activities on the territory of the Republic of Poland, an additional declaration should be attached, showing that conditions have arisen to allow them to begin performing brokerage activities in the territory of the Republic of Poland, defined in Article 117(3), second sentence, of the Act on Trading in Financial Instruments (hereinafter “Act”), or a document from the Polish Financial Supervision Authority (KNF) or the Office of the Polish Financial Supervision Authority, confirming that the Authority has received from the appropriate foreign supervisory body a notification on the intention to begin performing brokerage activities in the Republic of Poland, indicating the date when this notification was received;
- cards with specimen signatures of the applicant’s authorised representatives, as well as copies of power-of-attorney documents in instances where the right to represent the applicant by those persons submitting a specimen signature on the specimen signature card does not derive from the registration documents (form U5 EN, form U5 PL),
- cards with specimen signatures of persons authorised to make and receive declarations from KDPW on behalf of the applicant, these declarations not being declarations of intent (form U6 EN, form U6 PL),
- an information card containing addresses for deliveries as well as a list of staff employed in posts involving securities trading-related activities, that includes their positions, telephone/facsimile numbers as well as email addresses (form U15 EN, form U15 PL),
- a declaration giving consent to arbitration by the Arbitration Court at KDPW (form U7 EN, form U7 PL),
- a declaration indicting the number or numbers of bank accounts in the settlement bank (templates : U10 EN, U10 PL, U11 EN, U11 PL, U12 EN, U12 PL, U12.1 EN, U12.1 PL, U13 EN, U13 PL, U13.1 EN, U13.1 PL),
- a document containing a description of the principles and methods of managing a securities registry by the applicant, including rules for making entries on securities accounts or omnibus accounts – detailed guidelines concerning the content of the document prepared by an applicant operating securities accounts are set out in § 21 of the KDPW Detailed Rules of Operation (hereinafter “DRO”);
- a document containing the principles the applicant has adopted for maintaining the continuity and safety of operations related to securities registration – detailed guidelines concerning the content of the document prepared by an applicant operating securities accounts are set out in § 42 of DRO;
- a list of persons to be employed by the applicant to manage a securities register, containing a description of their qualifications and current experience in this field, or containing other information confirming that these persons have the required knowledge of the principles for keep a securities register and practical experience of the same.
According to § 18 of the Rules, the participation agreement shall be concluded two weeks after the submission of the relevant application together with all required attachments to KDPW if the entity submitting the application fulfils the participation requirements specified by the law and by the Rules, and the application and attached documents meet the formal requirements specified in the Rules.
In addition, please note that:
- the application and the attached documents require the delivery of the original document or an appropriately certified copy pursuant to § 4 subpara. 3 of the Rules, and in addition, documents referred to in points 1 and 2 which have been drawn up abroad should be legally authorised according to § 3 of DRO;
- according to § 2 subpara. 2 of DRO, documents attached to the application referred to in points 1 and 2, as well as powers of attorney delivered by participants, or by entities applying for a participation agreement, which have been drawn up originally in a foreign language, should be submitted in Polish translation, written and endorsed by a certified translator. Other documents including the application should be submitted in Polish;
- for the purposes of securities registration, participants keeping securities accounts or omnibus accounts are obliged to employ persons who have the appropriate expertise and experience or qualifications in this regard, as required under § 33 of the Rules, in the minimum number defined in Resolution No. 245/14 of the KDPW Management Board of 28 February 2014;
- direct participants are obliged at least once every calendar year to take part in Business Continuity System organised by KDPW, according to § 33a of the Rules.
An entity which has obtained direct participant status is obliged to sign an agreement with KDPW, referred to in § 4 subpara. 1 of the Rules, defining the rules of exchanging information and declarations available and delivered to and from KDPW in electronic form. Detailed requirements in this regard are available under the tab Participants / Technological Requirements (“Terms and conditions of sending and receiving information and declarations in electronic form binding in relations between KDPW and Participants” and “List of forms and structures of electronic documents binding in relations between KDPW S.A. and Participants”).
Operation of registration accounts must be preceded by the opening of entity accounts on the basis of relevant messages sent to KDPW (§ 26 subpara. 1 of DRO) and for derivative instruments – also the assignment of the NKK attribute on the basis of a relevant message sent by the participant to KDPW.