According to the Law of the Republic of Azerbaijan “On Securities Market”, investment companies and investment fund’s depositories may become a member of the National Depository Center (NDC). The membership requirements, the grounds for both admission and removal from membership, as well as the whole relationship between NDC and its members are regulated by its Membership Rules. An entity seeking membership shall meet the requirements defined by internal rules and fill the application form. Decision on admission is made on the basis of the applicant's compliance with the requirements. More information on the membership procedure is given in the Membership Rules.
Functions of the members are the following:
- managing accounts of securities holders;
- ensuring the transfer of securities in the depository system;
- providing the central depository with the information about customers and securities owned by them, which is necessary for the approval and protection of the customers' rights;
- providing account statements and transaction reports at customer’s request;
- informing the customers about the liquidation or reorganization or failure to perform their obligations;
- informing the central depository about the termination of the contract signed with the customer by indicating the reasons for termination;
- execution of the functions by the investment fund’s depositories, as well as functions defined by the Law of the Republic of Azerbaijan “On Investment Funds”.
Considering that according to the aforementioned law, NDC also performs clearing activity without getting the appropriate license, the investment companies and banks may become members of NDC as a clearing house.