AMENDMENT TO ACT ON SECURITIES AND INVESTMENT SERVICES

(Act No. 162/2003 Coll., amending and supplementing the Act No. 566/2001 Coll. on Securities and Investment Services and on amendment and supplement of certain acts, as amended)

The aim of this amendment is to overcome the time-incompatibility resulting from Section 163, para. 6, 7 and 8 of the Act No. 566/2001 Coll. on Securities and Investment Services, as amended (the ``Securities Act''), which differently determines the starting moment of performance of activities of the Central Depository, the moment of extinction of mechanism of accounting and composition of stock exchange transactions, process of creation, change and cessation of pledges over securities and process of registration of security transfers. While the Central Depository should have started to perform its activities pursuant to new regulations only after granting a membership to the first member of the Central Depository, in case of accounting and composition of stock exchange transactions, registration of pledges and recording of security transfers, the effectiveness of new regulations should have commenced on the day of validity of the first decision on granting a permission for establishment and activities of the Central Depository.

Therefore, the amendment states a new moment from which the provisions of the Securities Act shall apply and which is unified for all the above mentioned activities: the expiration of 60 days from granting a membership to the first member by the first Central Depository established pursuant to the Securities Act.

Further to the changes concerning the commencement of activities of the Central Depository and changes in the mechanism of accounting and composition of stock exchange transactions, the above mentioned time period is synchronised with the date of opening the OTC market, i.e. the over-the-counter market with listed securities.

At the same time, the amendment imposes a duty on the Central Depository to notify granting of membership to its first member to the Office for Financial Market and a duty to publish the date of granting this membership in daily press with national distribution which publishes stock exchange news within 3 days. These duties will guarantee provision of information for the capital market participants.

This amendment came into force on June 1, 2003.

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