1. INTRODUCTION
MERJ Foreign Depository Interests (FDI) on International Stocks and ETFs are securities issued by MERJ DEP or another approved issuer that have specified rights relating to underlying international stocks and ETFs listed on recognized securities exchanges (“Participating International Eligible Assets”). Title (as defined in the DI Directive) to underlying Participating International Eligible Assets is vested in an approved Depository Nominee (MERJ Nominees). The exact rights of FDI holders are spelled out in the MERJ DEP Rules Directive on Depository Interests ("DI Directive") and specific product summaries. At a minimum these will always include rights to 100% of the net (i.e. less any applicable withholding taxes on dividends) economic rights associated with the underlying Participating International Eligible Assets. Information on voting and withholding taxes is explained below in Section 4.
2. TRADING
MERJ FDIs on international stocks and ETFs trade on the International Order
Book (IOB) segment of the Main Market in accordance with the MERJ Market Rules and are available via any trading interface of MERJ or a Member.
3. CLEARING AND SETTLEMENT
Clearing and settlement of transactions in FDIs is facilitated by MERJ CLEAR in accordance with the Clearing Agency Rules.
4. RIGHTS ASSOCIATED WITH CORPORATE ACTIONS
With the exception of voting arrangements and some corporate actions of foreign issuers
domiciled in certain jurisdictions, an FDI Holder shall have the same rights as a registered
holder of the underlying Participating International Financial Product. These are covered in
Sections 23 to 25 of the Directive on Depository Interests of the Securities Facility Rules and
highlighted below.
Entitlement Date
The Entitlement Date is the date by which an investor must purchase an FDI in order to participate in an upcoming corporate action (e.g. a dividend) and is indicated in the Product Summary for each FDI but typically it will be 2 days before the "record date" of the underlying instrument (i.e. RD-2).
Distribution of Dividends or other Distributions to Holders of FDIs
Dividends or other distributions received by the Depository Nominee will be applied to the
account of the FDI Holder net of 30% US Withholding Tax for all accounts of non-US Persons and subject to Section 23.10 of the Directive on Depository Interests of the Securities Facility Rules if involving fractional entitlements.
Takeovers
Pursuant to Section 24 of the Directive on Depository Interests of the Securities Facility Rules
the Depository Nominee is not obliged to notify any FDI Holder, distribute any materials or
take any action in connection with a takeover bid for all or any of the Participating International
Eligible Assets and must not accept any such bid except, where the Depository Nominee has
agreed to act for FDI Holders, to the extent that acceptance is authorized by Holders of FDIs.
Voting
Pursuant to Section 25 of the Directive on Depository Interests of the Securities Facility Rules,
the Depository Nominee is not obliged to notify, nor exercise on behalf of any Holders of FDIs,
any voting entitlements in respect of the underlying Participating International Eligible Assets.
5. RISK FACTORS
Fluctuations in the price and trading volume of the underlying security will impact the price of the MERJ FDIs. As such, the price of MERJ FDIs may be subject to significant volatility. There is no protection from future market performance so you could lose the entire investment. Potential investors should review all documents in relation to the underlying security carefully in its entirety and consult with their professional advisers prior to making any purchases of an FDI. In making an investment decision, investors must rely on their own examination of the underlying security, including the merits and risks involved.
6.. QUOTED FDIs
Current list of MERJ FDIs:
7. FEES
Last Updated 10 Feb 2025