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?	VPC does not have any lending and borrowing scheme. However, banks and securities companies do offer such services to the market participants and their settlement agents.
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. Please see also the answer under 3.
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?	VPC has no guarantee-fund but applies a system of payment guarantees in the equity settlement (not for settlement of fixed income instruments). All members of the stock exchange, not being a bank and a member of the Riksbank, has to put up settlement guarantees, i. e. all securities companies. The guarantee assures that settlement really will take place and thus, no fail trades should occur.
4.	Are the stock transfer agents (share registrars) linked electronically to the depository?	For the time being VPC is the single CSD and at the same time acts as the one and only share registrar (however, no legal monopoly exists).
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 is no legal settlement schedule but market practise is T+3 on all traded securities (except for short term notes that are settled at T+2) which means that on settlement day the ownership is transferred between the seller end the buyer and in the books of the issuer.
6.	Are investors entitled to all benefits arising on a security from the point of purchase; and how are any rules enforced?	Yes, up to the last trading-day on trading terms "cum", the buyer is entitled to benefits like interest, dividend, new issued shares etc. VPC or the nominee custodian will enforce this. Entitlements are determined based on contractually settled positions as of record date (not based on traded positions as of ex date).
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 only for foreign corporates traded with Swedish Depository Receipts. For domestic corporates proxy voting is not in use. However, a power of attorney for the board of directors to vote on behalf of the share holder is sometimes used.
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?	Yes, binding rules for corporate actions are enforced by the Swedish Companies Act (1975:1385 to be amended within short).
9.	Are all voluntary corporate actions advised through a central mechanism assuring consistent information to all investors?	Yes, this is enforced by the Swedish Companies Act (1975:1385, to be amended within short) and carried out by VPC information system for VPC registered companies to its clearing members. Stockholmsbörsen also communicate corporate actions once they are due.
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?	Yes, it is communicated electronically and by advertisements in the newspapers. If any corporate action is decided in an irregular way it may cause a trading halt decided by Stockholmsbörsen until the information has been spread evenly to the market.