As a result, investors would be able to more easily exercise their rights and duties as shareholders, and issuers would be in a better position to communicate directly with end investors. New legislation in the Netherlands, currently expected to take effect in January 2010, imposes strict shareholder identification disclosure obligations on entities holding shares listed on a Dutch stock exchange on behalf of investors within and outside the Netherlands.

"Euroclear Nederland can serve as the central coordinator to gather and report shareholder information," says Hugo Spanjer, Member of the Euroclear Nederland Management Team. "We have the expertise to standardise the back-office processes entailed in such an initiative and deliver a cost-efficient shareholder identification and reporting service for securities issuers and shareholders alike. As many financial intermediaries, such as custodian banks and issuer agents, are already Euroclear Nederland clients, we are ready to work with them and the market at large to comply with the new regulation and increase end investor involvement in corporate governance."

Jaap de Keijzer, General Secretary of the Vereniging Effecten Uitgevende Ondernemingen (the Dutch Association of Listed Companies), added: "The central securities depository, as ultimate safe-keeper of an issuer's securities, is the natural entry point to the entire shareholder population. As a proven provider of automated and standardised services to facilitate information flows, Euroclear Nederland is well positioned to help issuers,
intermediaries and investors fulfil the new shareholder identification requirements. As a market infrastructure, Euroclear Nederland is a neutral, non-discriminating service provider that is already supervised by the Dutch central bank and financial regulatory authorities."

Standardisation will be a key factor in determining the success of an orderly shareholder identification process. Issuers and their agents will want to receive shareholder information as efficiently and quickly as possible, and custodian banks and other financial institutions will be confronted with such requests in a multitude of formats and communication channels, with varying timelines and conditions. Working through a central service provider that standardises these requests will substantially reduce inefficiencies, costs and risks for all parties involved. Euroclear Nederland has already initiated the design of proposed standards for the transfer of such data between those involved in the process, which have been agreed by the Dutch custodian banks that are members of Euroclear's local Market Advisory Committee.

Increasing shareholder involvement in corporate governance opportunities, such as voting at annual and extraordinary general meetings, continues to be a challenge. For example, in 2006, only 36% of the share capital was represented at the general meetings of AEX Index (Euronext Amsterdam) listed companies. The new Dutch law empowers issuers with the right to know the name and address of each shareholder, even when the securities are held through a chain of intermediaries. This information can be requested 60 days before a general meeting and must be provided within two business days of the request. Failure to comply gives issuers the right to pursue legal action. The new law applies to both Dutch and foreign intermediaries that hold shares listed on Dutch stock exchanges.