Securities (Chengetedzai Depository Company) (Central Securities Depositories and Securities Lending and Borrowing) Rules, 2026

The Securities and Exchange Commission has approved a full rulebook for Chengetedzai Depository Company, covering both the central securities depository and the securities lending and borrowing (SLB) market that runs on it.

Only a defined set of institutions can be participants: the Reserve Bank, holders of a securities custody, trustee, dealer or transfer licence, dealers authorised to provide custody, and settlement banks. Applicants apply on Form CSD6 with a fee, must have had no fraud or misappropriation conviction in the past ten years among directors or controllers, must hold adequate insurance and financial resources, and are processed within 30 days. Registration is renewed a month before each financial year; miss it and a penalty runs, and after three months the Depository suspends the participant and calls on it to show cause.

Participant duties are detailed. Depositor accounts must be segregated from each other and from the participant's own securities; no debit or credit may be made without the depositor's instruction; KYC and anti-money-laundering checks apply before any account is opened; original account documents must be kept for at least ten years; instructions must be executed the same day or by the close of the next business day; monthly complaints reports go to the Depository; and reconciliation against the Depository's statements is a daily obligation, with the participant liable for losses caused by late reporting of an error. A participant cannot assign its business — including through a substantial change of shareholding or board — without prior written approval.

On the depository accounts themselves, the rules set out dematerialisation on Form CSD 2 with the share certificate, rematerialisation on Form CSD 3, account freezing at the depositor's or a regulator's instance (credits still allowed, debits not), corporate action notification by the transfer secretary within seven days, and pledging, where the Depository electronically locks the pledged securities and, on verified default, transfers them to the pledgee.

Securities lending and borrowing is built around collateral. Only registered participants may act as SLB agents; collateral must be deposited with a settlement bank under a tripartite agreement before a borrowing request is captured, is marked to market daily, and earns interest for the borrower. Legal title in loaned securities moves temporarily to the borrower while the lender keeps the economic benefits and earns a lending fee. An agent that does not top up collateral within 48 hours has the transaction closed and the collateral used to buy securities for the lender. Contracts are standardised and cannot be varied without the Depository's written approval.

The money is in the Second and Third Schedules. Settlement banks and custodians pay a US$5,000 application fee and US$5,000 a year, with custodians charged 0.025% of the value of securities held, capped at US$15,000. Stockbrokers pay US$2 per trade on broker-controlled accounts. Issuers pay US$2,000 for ISIN admission and the same for deactivation, plus an initial administration fee of 0.025% of market capitalisation between US$2,000 and US$20,000. Transaction charges include US$3 per investor for uploading or deactivating shares, US$20 for a portfolio movement or account transfer with no change of beneficial owner, US$30 for rematerialisation, US$200 for a custodian-funded early settlement, and STP licence fees of US$6,500 or US$3,500 a year. Bond issuers pay 0.050% of funds raised on onboarding (US$2,500–US$15,000) and 0.025% annually (US$1,500–US$25,000).

Penalties are specific: 0.2% of the annual fee per month for late renewal, US$5 a day for a late account opening form, US$10 per client for failing to provide a statement, 0.5% of the transaction's market value per day (minimum US$150) for failing to settle, and 0.2% of the shortfall or a minimum US$2,000 for failing to top up collateral. Participants may appeal a Depository decision to the Commission within 30 days.