New rights guaranteeing many online investors a copy of the annual report and accounts and notices of meetings will come into force on Monday (1 October). Investors who hold their stock in paper form, as share certificates, already get these rights as standard.

But with online share dealing, stockbrokers frequently pool customers’ shares into one account known as a nominee. The downside of this system is that, unlike with a share certificate, the shareholders’ names aren’t on the share register and, as the law currently stands, they lose their rights. This is all changing from Monday as new legislation, written into the Companies Act 2006, means companies will be obliged to send information to investors with holdings in nominee accounts. This service will only be provided if asked for, and not all stockbrokers will facilitate it – nothing in the new law says they have to.

The Association of Private Client Investment Managers and Stockbrokers (APCIMS) recently polled 30 brokers and found ten ready to go on 1 October while four said they would wait and see, 16 reported no interest in facilitating the new rights.

For shareholders who do opt in on 1 October, information will not start flowing until 1 January, says Bridget Salaman, head of policy at the Institute of Chartered Secretaries & Administrators (ICSA), which represents companies. ‘Opt-in can take place on 1 October but requests don’t need to be serviced until the new year,’ says Salaman. In early October, the ICSA will publish guidance on how companies should deal with information requests.

Nominee accounts have the benefit of allowing the broker to hold investors’ shares electronically in ‘book entry form’ in the Crest settlement system. This means settlement times are reduced to T+3 (trade date plus three days). That compares with T+10 for settling certificates, which have to be posted to the broker, then forwarded to the registrar to prove ownership.

Investors can opt for Crest personal membership. As with nominee accounts the shares are held in book entry form in Crest but under the investor’s name rather than under the nominee account name so the shareholder’s name also appears on the share register. Not all brokers offer Crest membership and those that do charge fees.