Act no. 577 of 6 June 2007 amending the Financial Business Act and various other acts (not translated) implements the regulations of EU Directive 2006/48/EC of 14 June 2006 relating to the taking up and pursuit of the business of credit institutions (recast) with regard to issuing covered bonds (SDOs/SDROs).
The Act entered into force on July 1, 2007.
The Act means that only undertakings with a license from the Danish FSA can issue SDOs/SDROs.
Undertakings which issue SDOs/SDROs are subject to Danish FSA supervision and individual issues must be registered in a register open to the public.
The Danish FSA keeps an electronic register of each issue of SDOs/SDROs, based on notifications by the issuer to the Danish FSA.
The register is regularly updated by the Danish FSA. If an issued SDO/SDRO loses the status "covered" because top-up collateral is not established, cf. section 152a(2) of the Financial Business Act, section 33d(2) of the Mortgage-Credit Loans and Mortgage-Credit Bonds etc. Act, and section 2(2) of the Act on a Ship Financing Institution (Lov om et skibsfinansieringsinstitut), the issue will be deleted from the register.
The idea behind the register is that investors and others should be able to identify the individual securities and that the register should make it quick and easy to get hold of information about issues of bonds which are "covered" and therefore have a specially low risk weight for capital adequacy purposes.
The issuer is responsible for ensuring that the information about the issue of bonds is correct, as the Danish FSA does not check this.