Recommendation 1 Recommendation 2 Recommendation 3 Recommendation 4

Recommendation 5 Recommendation 6 Recommendation 7 Recommendation 8

Market selection

Recommendation 4

Each market must have clear rules assuring investor protection by safeguarding participants from the financial risks of failed settlement and ensuring that listed companies are required to follow sound policies on corporate governance, transfer of economic benefits and shareholder rights.

1.	Does the depository or the market have securities lending and borrowing schemes in place, and are these open to all market participants and their settlement agents?	Clearstream Banking has been offering a fails lending service. Clearstream Banking acts as an agent to the lender and the borrower. Clearstream Banking provides full settlement of the loan transactions, the required collateral transfers, the daily mark-to-market, reporting and execution of corporate actions.
2.	Does the settlement system mark fail trades to market and collect margin from the failing counterparty to protect the innocent counterpart's interest?	No. However, we do offer an Automated Securities Lending and Borrowing Programme (ASL) which assists in fails management and that customers can elect for under ASL Terms and Conditions, where daily mark-to market and daily margining practises are covered.
3.	Does the market operate a guarantee fund or have an equivalent procedure to protect against the cost of failed transactions; and which sectors of the market does it cover?	No.
4.	Are the stock transfer agents (share registrars) linked electronically to the depository?	No electronic link between the transfer agent and the depository exists at the moment.
5.	Is there a legal maximum time period to complete ownership transfers in the books of the issuer? If so, does market practice adhere to the deadline?	There are no specific laws relating to a time limit for the transfer of ownership although for stock exchange trades , they must be due to settle on the 3rd day(T +3). For registered shares transfer of ownership is deemed to occur upon final re-registration and for bearer shares upon the trade date. Luxembourg law makes no distinction between stock exchange and non-stock exchange shares.
6.	Are investors entitled to all benefits arising on a security from the point of purchase; and how are any rules enforced?	There are no legal restrictions for investing in Luxembourg save the restrictions for foreign investors imposed by their own domestic bodies. The only other restrictions would be those imposed by the Company for certain corporate events. Investors are entitled to the full benefit upon purchase of a security within Luxembourg. If these trades are open over the record date of an event then they would be enforced upon settlement of the trade through manual reconciliation with the counterparty. In the future there are plans to develop an automated compensation process for open trades over record date based on the trade date of the purchase. These will be based on either the trade date or the settlement date, will depend on the type of security and are subject to domestic market entitlement compensation rules.
7.	Is proxy voting permissible in the market and can such proxies be lodged by post or other remote delivery method?	Proxy voting is permissible in the market and this can be lodged with the help of Clearstream through proxy by post or in person, upon receipt of information from the Company.
8.	Are there binding rules in the market stating the minimum and maximum lapsed time between the announcement and completion of key events, including registration, the calling of shareholder meetings, the payment of dividends or interest, rights issues, tender offers and other voluntary corporate actions?	The timing of corporate events is subject to the decisions of the company although legally a general meeting must occur once a year. Generally speaking therefore, such events may vary in structure and timing. Luxembourg companies utilise most forms of voluntary and mandatory corporate events including capital increases through subscription offers, bonus issues, company restructures and income events.
9.	Are all voluntary corporate actions advised through a central mechanism assuring consistent information to all investors?	Customers can be advised by Swift , Cedcom or Telex depending on the customer preference. However the information contained in each of these mediums of communication, stem from a centralised custody system and therefore will be consistent.
10.	Is information on corporate actions available electronically, and is the minimum lapsed time for responding to such actions sufficient to enable all domestic and foreign investors to respond in a timely and considered fashion?	Subject to the receipt of sufficient information from the relevant data sources all information is available in an electronic form as stipulated by the customer. The deadlines given to the customer are generally 2 days prior to the depositories deadline. This is considered sufficient for both domestic and foreign investors.