Corporate Actions faq
Corporate actions are announced via the platforms. You can find them in the following modules:
- Invest and FLEXibility: Account> Other > Corporate action events.
- Advance: Add Module > Other > Corporate action events.
They can be either mandatory, for which no choice is offered to the owner of the stocks (such as a delisting), or voluntary, which means the owner has the option to make a choice via the module available in the platform. If no choice is made within the deadline, the default option will be applied.
Cornèrtrader publishes the events as soon as the agent receives the information. However, it does not proactively research or offer prior information regarding incoming corporate actions. Therefore, the communication received from the counterparty is often at short notice or delayed and, in any case, not contextual to any official publications. For these cases, Cornèrtrader cannot be considered liable. If you know of a corporate action that has not been published on the platform yet, please feel free to contact us. In particular, for a delisting, we can verify if it is possible to realign the stock on another market. For this service, our custodian charges a fee. Find out more on the commissions page: click here
For some corporate actions, beneficial owner details may be required in order to provide the instructions. In such cases, Cornèrtrader will take contact to inform about the requirements. If the information is missing or incomplete, the clients’ instructions may be rejected and no liability will be accepted.
Cornèrtrader can proceed with the booking of dividend payments and other entitlements only after having received confirmation by the agent and/or the custodian. Therefore, in many cases the booking can take longer than the official announced date or can be delayed.
Corporate action events may result in entitlements of a product not supported by Cornèrtrader. In these cases, it is recommended to transfer the new position entitlements to another broker or bank upon receipt. Cornèrtrader cannot be held liable for any losses or compliance that may arise.
The day before some corporate actions will take place (ex-date) open orders on CFDs on the underlying securities will be deleted. These are generally liquidation, merges, stock splits, reverse stock splits and spin off. For distributions and right issues (such as capital gain distribution, cash dividends, dividend options/reinvest, right issues, share premiums, stock dividends), all open orders on the underlying instrument will be deleted, if the variation in the market price is calculated as being above 20% compared to the current price as an effect of the corporate action event.
It is a standard practice, especially for US depositary receipts, to charge an annual administration fee. The fee covers the operational costs of the depositaries. Typically, this fee will be deducted when the dividend payment has been done. In case the custodial fee was not included in the dividend events, it will be managed separately through a fee-only event. The fees usually do not depend on the total amount of the dividends paid but on the amount of the stocks held. If these fees apply, Cornèrtrader will book those directly on the client’s account, upon agent’s communication.
Some issuers may announce to offer entitlements in different markets. In these cases, the entitlements should be transferred and registered in the respective markets first (realignment) and only subsequently, they can be made available for trading. The process can take additional time and is subject to a fee. During the transfer period, the entitlements are blocked for trading.
If a corporate action involves an instrument that cannot be traded online, the position will be added to the customer account for reporting purposes only.
If you have requested to move a position from one subaccount to another after you have elected an option and this has not been exercised yet, please note that the previous election will be cancelled, as corporate actions can only be elected and applied on the account where the position is actually booked. Should this happen, you will need to elect the corporate action again on the account where the position has been allocated.
When special and infrequent corporate actions occur, Cornèrtrader will try to handle them in the best interest of clients to the extent of time and operational process permits.
The incomes generated by the corporate actions will be credited net of applicable fees and statutory withholding taxes, without taking into account any relevant double taxation agreement. The bank does not currently support or offer any services related to the reduction of withholding taxes, tax reclaims or application of double taxations agreements. Customers are therefore advised to consult a tax advisor, should they deem it necessary.
Please note that Cornèrtrader does not support the additional withholding tax USA. It is, therefore, not possible for clients to reclaim the additional withholding tax USA (currently set in 15%) from the Swiss tax authorities.