How are shareholdings registered electronically?
Investors can choose to have their holdings registered in one of two ways:
1. On an Issuer Sponsored Subregister; or
2. On the CHESS Subregister.
The two types of subregister provide alternative forms of registration for shareholders and the shares they own. Every ASX listed company manages its own Issuer Sponsored Subregister for the registration of shares in their company alone. This form of registration is also referred to as being Issuer Sponsored.
Alternatively, shares in any listed company can be registered in the
CHESS Subregister. This form of registration is held within the CHESS
system and allows brokers to manage their sponsored client's
shareholdings. This form of registration is also referred as being
To illustrate the difference between the two subregisters, consider an investor with shares in three companies, X, Y and Z. If the investor chooses to hold shares on the Issuer Subregisters, X shares will be held on Company X's Issuer Sponsored Subregister, Y shares will be held on Company Y's Issuer Sponsored Subregister and Z shares will be held on Company Z's Issuer Sponsored Subregister. Three share holdings will require three separate Issuer Sponsored registrations.
Alternatively, the investor who is Broker Sponsored can include X, Y and Z shares in a single registration held in CHESS under that investor's name. This has the advantage of simplifying the administration of a portfolio by consolidating all shareholdings into a single account. There may also be benefit for frequent share traders during the settlement process since their details will already be registered with CHESS.