Companies falling in scope
Demat is only applicable to listed companies, not private companies?
EQ response from March 2026 webinars: To be confirmed. The expectation is it will be mandated for publicly traded companies (LSE/AIM/Aquis). Mandating it across all private companies isn’t seen as feasible; treatment for private companies may be optional.
Non-UK companies
Where an issuer is a non-UK company, do you envisage a remat solution being feasible for shareholders with whom contact has been lost as part of this change?
EQ response from March 2026 webinars: Generally, no. For international securities, particularly where the originating market is already dematerialised—rematerialisation is not an option; any such provisions would apply selectively.
What do we envisage the solution is for shareholders outside of the UK or even EU and what problems do we think we’ll encounter?
EQ response from March 2026 webinars: Custody is regulated in the holder’s home market, so UK nominees generally can’t provide regulated services to, for example, US holders. For Step 3, issuer communications will be key; international holders may need to move earlier to an appropriately regulated nominee in their home market, depending on the eventual default solution.
Articles of Association
Amending articles in 2027 is optional?
EQ response from March 2026 webinars: Correct. The legislative changes are expected to override articles, so amendments aren’t strictly required for Step 1. Many issuers may nonetheless choose to align their articles in 2027; a busy AGM season is expected.
Electronic communications and payments
How forceful are the expected powers for issuers to collect bank mandates and email addresses? Will it be mandatory for shareholders?
EQ response from March 2026 webinars: This is a developing area which remains under consideration. At this stage, we expect that shareholders will not be criminalised for failing to provide an email or bank details. An alternative approach could be that rights may be restricted if information is not supplied — for example
- No bank mandate → no dividend payment
- No email address → no company documents
Digital contact details may also become mandatory to complete a transfer on the digital register.
These levers would aim to drive digital communication/payment uptake without imposing direct penalties.
Untraceable/historic shareholders
Have you seen companies looking at updating articles in 2026 to reduce share forfeiture periods as part of the steps to update the register in advance of 2027?
EQ response from March 2026 webinars: Yes. We have seen companies—particularly companies with larger directly registered shareholders—bringing forward article changes to reduce forfeiture periods (typically from 12 to 6 years). It’s not yet the majority but there’s a noticeable increase across last year and this year, and it’s likely to continue into 2027.
There are a lot of historic shareholders on the register. Will there be an exercise to reverify holders before they default to a nominee / Corporate Sponsored Nominee (CSN) or is it an automatic transfer regardless?
EQ response from March 2026 webinars: At this stage our expectations are that for Step 1: No reverification and no automatic transfer; shareholders don’t need to act. Step 3: the default “backstop” for nonresponsive holders is still to be defined (e.g., broad CSN, central government nominee, reclaim fund).
Substantial shareholders
For substantial shareholders (holding more than 3%), if their paper share certificates are changed to demat, will it require them to file TR1 notifications during the conversion considering the intermediary will be the registered shareholder?
EQ response from March 2026 webinars: No, not for Step 1. Removing the legal status of paper certificates does not change beneficial ownership, so a DTR/TR1 disclosure isn’t triggered merely by digitising the register.
Vulnerable shareholders
How are vulnerable shareholders being considered?
EQ response from March 2026 webinars: DEMAT has actively recognised the impacts for vulnerable investors — areas such as anxiety caused by change, and challenges with digital processes. A full roundtable was held specifically on vulnerable investors, and DEMAT includes a retail investor representative to ensure retail investor protections are built into recommendations. We expect legislative changes will be designed and implemented as sensitively as possible while still enabling the broader market transition.
Corporate Sponsored Nominee
For issuers with an existing Corporate Sponsored Nominee (CSN), what impact is anticipated?
EQ response from March 2026 webinars: No action is required for Step 1. In due course, untraceable (“goneaway”) CSN participants may be ejected so company forfeiture provisions can operate; this also addresses accrued dividends within CSNs.
Employee share plans
Do we need to review Share plan rules?
EQ response from March 2026 webinars: Step 1: Plan rules should roll across neatly; extensive changes aren’t expected. Step 3: Focus on the post award holding options you’ll offer (e.g., Indival Savings Account (ISA) via EQI, Global Nominee, CSN)—these are already Step 3 compliant; only limited technical changes may be needed.