The act on the financing of investments to secure the future (Future Financing Act) came into force for the most part on December 15, 2023. Among other things, the act is intended to facilitate access to the stock market and the procurement of equity capital. The Future Financing Act amended the Electronic Securities Act (eWpG) so that bearer and registered stocks are now explicitly covered by the scope of the eWpG. This dematerializes the stock. The previously common securitization of stocks, for example in a global certificate, is no longer mandatory. Instead, electronic stocks are also treated as objects, which establishes security and transfer functions such as acquisition in good faith for electronic stocks. An electronic security is issued by the issuer making an entry in an electronic securities register instead of issuing a securities certificate. The following explanations are intended to highlight some of the practical aspects associated with the new electronic stock.

Registered Stocks Can Be Issued as Crypto Securities

The eWpG establishes two types of electronic securities, the central registry security and the crypto security. The central registry security is an electronic security that is entered in a central register. Such central registers can be maintained by central securities depositories or a custodian. A crypto security is an electronic security that is entered in a crypto securities register. A crypto securities register must be kept on a tamper-proof recording system in which data is logged in chronological order and stored in a manner that is protected against unauthorized deletion and subsequent modification, such as a blockchain. This makes it possible to issue tokenized stocks. Both the central registry security and the crypto security can be issued to different holders in individual and collective registration. The Future Financing Act provides that registered stocks can be issued as crypto securities and central registry securities. Bearer stocks, on the other hand, may only be issued as central registry securities. With regard to a possible IPO, however, it should be noted that only central registry securities in collective registration are covered for settlement in the securities giro and therefore only such securities are suitable for stock exchange trading, unless an exception applies under the current DLT pilot regime.

Articles of Association of the Stock Corporation Must Provide for the Issuance of Electronic Stocks

In order to issue electronic stocks, the articles of association of the stock corporation must provide for the exclusion of securitization. Registered stock in the form of a crypto security can only be issued if the articles of association expressly permit this. In the case of existing stocks, an issuer may replace a security issued by means of a global certificate or by means of individual certificates held in collective custody with a central registry security with the same content at any time and without the consent of the beneficiaries. Provided that the articles of association exclude the securitization of stocks, they must be amended. In all other cases of conversion, the approval of the shareholders is required. Conversely, electronic stocks can also be converted into securitized stocks. Because the exclusion of securitization must be provided for in the articles of association in order to issue electronic stocks, conversion into a paper certificate would require the exclusion of securitization to be removed.

Attorney Dr. Konrad Uhink



The lawyer responsible for issues relating to securities law in our law firm is Attorney Dr. Konrad Uhink.