Modification of the Bylaws of the Society for the Management of Securities Registration, Clearing and Settlement Systems, S.A.U. (BOE August 18, 2016)

OFFICIAL STATE GAZETTE No. 199 Thursday, August 18, 2016 Sec. V-C. Page 48206cve: BOE-B-2016-38800 Verifiable at http://www.boe.es V. Announcements C. Particular Announcements PARTICULAR ANNOUNCEMENTS 38800 SOCIETY FOR THE MANAGEMENT OF SECURITIES REGISTRATION, CLEARING AND SETTLEMENT SYSTEMS, S.A.U. MODIFICATION OF ITS BYLAWS.

• Article 32, paragraph 3, is amended as follows: "3. The Systems Society shall regulate by Circular the procedure for communication, acceptance, and execution of transfer orders arising from transactions concluded on an official secondary market or a multilateral trading system with which the Systems Society has entered into an agreement, which may include the application of the special and optional financial intermediary procedure referred to in Article 33 of these Bylaws."
• The first three paragraphs of paragraph 1 of Article 33 are drafted as follows: "1. With regard to transfer orders for securities and cash arising from transactions carried out on official secondary markets and multilateral trading systems, with or without the intervention of a central counterparty, the Systems Society has a special procedure for transfer orders from participating entities originating from financial intermediaries that settle transactions on their own behalf and on behalf of those of their clients who meet the requirements established in this article. The transfer orders for securities and cash under this procedure shall be subject to the same rules of irrevocability and finality provided for in the previous Article 31, regardless of whether they are communicated, accepted, or executed in the transitional phases or the final phase. Specifically, orders originating from participating entities (auxiliary operations) require matching with the opposite-sign order originating from the entity that acts as counterparty; and orders received from the market, multilateral trading system, or central counterparty (settlement instructions) are received already matched at the moment of their communication to the Systems Society, as they consist of the two opposite-sign transfer orders. For the purposes of this special procedure, financial intermediaries shall be considered to be investment service firms and credit institutions subject to the legislation of a Member State of the European Union, as well as entities from third countries, which are authorized to provide services to professional clients, as those clients are defined by Article 205 of the Securities Market Law, and, at least, to transmit orders from those clients and participate in the settlement of the transactions resulting therefrom."
• Article 33, paragraphs 3 and 4, are drafted as follows: "3. The special procedure shall not apply to orders placed with the financial intermediary by: a) Retail clients. b) Clients that are a participating entity in the Systems Society. 4. This special procedure may be used whenever it is included in the corresponding Agreement agreed upon between the Systems Society and the official secondary market, multilateral trading system, and central counterparty under the terms provided for in Article 47 of these Bylaws, and its use shall be optional for participating entities, the financial intermediary, and the clients on whose behalf the latter acts."

OFFICIAL STATE GAZETTE No. 199 Thursday, August 18, 2016 Sec. V-C. Page 48207cve: BOE-B-2016-38800 Verifiable at http://www.boe.es

• Article 33, paragraph 5, fourth paragraph, is amended as follows: "By Circular of the Systems Society, the relationships between the special accounts of financial intermediaries and the individual accounts of financial intermediaries shall be established for the case where the aforementioned registrations in the name of the financial intermediary's clients are not carried out at the close of the settlement process, and the actions that must be taken regarding any potential balances of securities that may then remain in the aforementioned special accounts." Madrid, August 4, 2016.- Jesús Salvador Benito Naveira, Managing Director. ID: A160059010-1 http://www.boe.es OFFICIAL STATE GAZETTE D.L.: M-1/1958 - ISSN: 0212-033X