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What is NVDR? |
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An NVDR or Non-Voting
Depository Receipt is a new trading instrument issued by the
Thai NVDR Company Limited, a subsidiary wholly owned by the
Stock Exchange of Thailand (SET). NVDRs are automatically
regarded as listed securities in the SET.
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Benefits from investing in NVDR |
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Foreign investors can invest in common stocks
that are listed in The Stock Exchange of Thailand without the
restriction of foreign limit.
It eliminates foreign investment barriers, such as foreign investment
limits and impediments for institutional investors who previously
could not trade in the existing Thai Trust Fund.
Investors will receive the same financial benefits as if they
have invested in the listed securities except that they will
have no voting rights.
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Who can trade |
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All types of investors are allowed to trade NVDR.
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Underlying Securities |
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All listed securities in the SET.
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How to trade |
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The trading procedure is similar to the procedure
for other listed securities. Investors wishing to trade the
NVDR for any security can send their requests during normal
trading hours via their brokers by specifying their trading
orders to be the NVDR type. This procedure is provided in the
ASSET system.
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Price Quotation |
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Same as those of the underlying securities.
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Brokerage Commission |
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Same as those of the underlying securities.
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Disclosure of Trading Data |
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Look at the trading data of underlying securities.
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Trading Suspension |
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Posting Halt (H) or Suspension (SP) signs will
be done in the same period as the underlying securities.
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Acquisition report |
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- NVDR holders have to report the acquisition or disposal
of their NVDRs and underlying securities to the Thai NVDR
Co. Ltd. in the same manner as reporting acquisition or
disposal of the underlying securities.
- When the aggregate total acquisition or disposal reaches
any multiple of 5% of the underlying company's registered
capital.
- When the aggregate total acquisition of disposal is up
to 25% of the underlying company's registered capital, the
Thai NVDR Co., Ltd. will buy the excess number of NVDRs
back from the holder.
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Clearing and settlement |
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Like the clearing and settlement process for
other listed securities, the NVDR is also cleared and settled
by the Thailand Securities Depository Co. Ltd. (TSD), through
brokers, at T+3
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Registrar of NVDR |
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The Thailand Securities Depository Company
Limited (TSD)
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Deposit of NVDR |
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The Thailand Securities Depository Company
Limited (TSD)
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Tax Benefit |
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Types of Investors |
Capital Gains |
Dividend |
| Individual Resident in Thailand (Stay in
Thailand more than 180 days in that tax year) |
Tax Free |
- Must pay a 10% withholding tax but can exclude this
income from the year-end personal income tax calculation.
- Or if the 10% withholding tax is not paid, then the
income must be included in the year-end tax calculation.
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| Individual Non-resident in Thailand(Stay in Thailand
less than 180 days in that tax year) |
Tax Free |
10% withholding tax |
| Resident Company and Registered Partnership in Thailand |
Must declare all capital gains from trading
securities at the SET for corporate income tax assessment
at the rate of 30% |
Same as capital gain |
| Non-resident Company and Registered Partnership in Thailand |
15% withholding tax |
10% withholding tax |
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NVDR Conversion |
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Any trading must record put-through transaction
via The Stock Exchange of Thailand.
From securities to NVDRs
If investors wish to convert their securities on hand into NVDRs,
they must record put-through transactions (selling the securities
and buying the NVDRs) in the SET.
From
NVDRs to securities
Any NVDR holder who needs to change his holding position from
NVDRs to securities, must process the transaction via the put-through
system at the Stock Exchange of Thailand
Remark : Any conversion must be done
through a securities broker. |
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Last updated: 25 October
2002 |
