Services to Investment funds' depositories
The Law of the Republic of Azerbaijan “On Investment Funds” determines the organization, management and liquidation principles and rules of investment funds, as well as the legal and economic basis of regulation and supervision of investment fund activities.
Investment fund is a financial institution dealing with collective investment activity. Safekeeping of the stocks (shares) of the investment fund, keeping records and affirmation of the rights and encumbrances, as well as safekeeping of the managing assets of the investment fund and related documents are carried out by the depositories of the investment fund, unless otherwise provided by the legislation. The depositories of the investment fund, which shall be the members of the central depository, form the depository system together with the central depository and the investment companies.
Pursuant to the Law of the Republic of Azerbaijan “On Investment Funds”, the central depository carries out the registry of the investment funds’ shareholders. The central depository also opens a correspondent account in each currency for every depository in accordance to the “Rules for account opening, maintaining and money transfer by investment fund’s depository”.
In case of liquidation of the investment fund’s depository, the investment fund manager concludes a temporary arrangement with the central depository on depository services until the selection and approval of the new investment fund’s depository. Accordingly, the funds of the liquidated depository are transferred to the central depository’s account (indicating information on the balances of each investment fund).
National Depository Center provides the following services to the investment funds’ depositories:
- registration of the fund’s assets;
- acceptance of the fund’s securities, funds and original documents confirming the property rights and safekeeping them;
- controlling the allocation (purchase) and repurchase of fund’s shares;
- keeping the records of the value, movement and composition of the fund's assets;
- controlling the correct calculation of the shares value after the fund's formation.