In order for your ACAT or ATON transfer to be completed successfully, your broker must validate the account number provided on the request. If the account number is invalid, your broker will reject the request. To avoid such rejects, IBKR may delay the transmission of your ACATS/ATON request if the account number you have provided does not match the alpha-numeric pattern used by the selected broker. IBKR will send a notification for you to review and correct your account number.
Details for updating the account number are below.
An update to a valid account number will prompt the transmission of your request to the delivering broker. An update to an invalid account will not be transmitted and you will receive a new email alert the following day requesting additional account number updates.
If you determine the request is being held up for review incorrectly, please create a web ticket for further review by Interactive Brokers.
HK Stock Physical Certificate Deposit FAQ
⦁ Does IBKR support HK stock physical certificate deposit?
Yes, we support stock physical certificate deposits for stock trading on HKEX and available to trade at Interactive Brokers. We do not support physical withdrawals and reserve the right to reject any deposit.
⦁ Does Interactive Brokers Hong Kong charge any fees?
Certificate Size | Processing Fee |
HKD 500,000 or above (Full Service) | Free |
Less than HKD 500,000 (Full Service) |
HKD 300.00/first stock certificate per day HKD 100.00/each additional certificate per day |
Less than HKD 500,000 (Self Service) |
HKD 200.00/first stock certificate per day HKD 20.00/each additional certificate per day |
In addition to the above, there is also a fee of HKD 5 stamp tax per transfer form. Cash cannot be accepted. Please prepare a cheque for HKD 5 per transfer form payable to “The Stock Exchange of Hong Kong Limited”.
⦁ How do I initiate a request?
Please compose a web ticket from the Client Portal under the category Funds & Banking > Position Transfer with all of the following information to avoid delays:
Full Service
⦁ Make an appointment and deliver your physical certificate(s) to our office as follows:
Admiralty - Suite 1512, Two Pacific Place, 88 Queensway, Admiralty, Hong Kong SAR
Kwun Tong - Suite 3204-05, AIA Kowloon Tower, Landmark East, 100 How Ming Street, Kwun Tong, Hong Kong SAR
⦁ A cheque for HKD 5 payable to “The Stock Exchange of Hong Kong Limited” for each transfer
⦁ You will receive a receipt from IBKR within one business day.
Self Service
⦁ Our Client Service team will contact you by email and provide a “Standard Form of Transfer”;
⦁ Complete the “Standard Form of Transfer” by following below guidance.
⦁ Make an appointment and deliver your physical certificate(s) to our office as follows:
Admiralty - Suite 1512, Two Pacific Place, 88 Queensway, Admiralty, Hong Kong SAR
Kwun Tong - Suite 3204-05, AIA Kowloon Tower, Landmark East, 100 How Ming Street, Kwun Tong, Hong Kong SAR
⦁ IBKR will counter sign the form and return you for delivering all of the below documents to HKSCC. Address – 1/F, One & Two Exchange Square, Central, Hong Kong SAR.
⦁ The countersigned Standard Form of Transfer
⦁ CCASS Stock Deposit Form (Prepared by IBKR)
⦁ The physical certificate(s)
⦁ A cheque for HKD 5 payable to “The Stock Exchange of Hong Kong Limited” for each transfer
⦁ Provide a scanned copy of the receipt to IBKR.
⦁ When will the shares be credited to my IBKR account?
Typically, the shares will be reflected on your IBKR account within 3-4 business days. However, as the share registry has the right to reject deposits, IBKR will apply a 12 business day hold on the shares during which time you will not be able to sell nor withdraw the shares deposited.
⦁ Instruction and Sample – Standard Form of Transfer
You can initiate a DWAC transfer request in Client Portal:
This is an important document regarding the proposed transfer of your account from IBUK and IBLLC to IBIE that requires your attention. Please read the entirety of this document ahead of taking any action referred to in the Covering Letter sent to you via email.
Please take time to read this FAQs, which summarises some of the key changes to the regulatory framework which will be brought about by the Proposed Transfer (as described below) and provides answers to some of the more general questions that you may have. The FAQs should be read in conjunction with the Covering Letter and the documents that are attached to the Covering Letter. If you require any further information, please get in touch with us using the contact details provided in the Covering Letter. This FAQs supersedes the one previously made available to you titled “FAQs: Brexit Account Migration” (“Original FAQs”) as it reflects new information, and we ask that you read it carefully. To the extent there is any inconsistency between this FAQs and the Original FAQs, please rely on the information contained in this FAQs.
Discussion:
This FAQs is split into three parts.
1. What is the situation currently and why do things have to change?
As you will be aware, at present, your relationship with Interactive Brokers is led by our entity based in the United Kingdom, specifically Interactive Brokers (U.K.) Limited (“IBUK”) and the services provided to you are provided by IBUK and, depending on the products you do business in, our US affiliate Interactive Brokers LLC (“IBLLC”). At present IBUK utilises what is known as a financial services passport to be able to perform its part of the service provision across continental Europe. Our working assumption is that following the end of the Brexit transitional period later this year, IBUK will lose its financial services passport and that from 1 January 2021 Interactive Brokers will need to make some changes in relation to which legal entity does business with you.
2. What are the “changes” envisaged above?
We have established a new Interactive Brokers legal entity in Ireland, namely, Interactive Brokers Ireland Limited (“IBIE”). We propose to transfer the business that you currently conduct with IBUK and IBLLC to IBIE. In other words, it is our intention that all of your accounts, investments and services currently provided to you by IBUK and IBLLC will instead be singularly provided by IBIE (for convenience we will refer to this as the “Proposed Transfer”).
3. When will the Proposed Transfer occur?
We will write to you again ahead of the Proposed Transfer.
4. Who is IBIE? What sort of a firm is it?
Effective 22 December 2020, IBIE became authorised as an investment firm by the Central Bank of Ireland. Its regulatory status and profile will be very similar to IBUK’s. This is because both IBIE and IBUK will be authorised pursuant to the second Markets in Financial Instruments Directive (Directive 2014/65/EU). This is an EU-wide piece of legislation the purpose of which is to, as much as possible, harmonise how investment firms are regulated across the EU
This does not mean there are not some differences between the legislation that applies to your relationship with IBUK and IBLLC at present and that which will apply once your account is transferred to IBIE. We explain this in more detail in Part B of this FAQs.
5. What are IBIE’s legal details?
Interactive Brokers Ireland Limited is registered as a private company limited by shares (registration number 657406) and is listed in the Register of Companies maintained by the Irish Companies Registration Office. Its registered address is 10 Earlsfort Terrace, Dublin 2, D02 T380, Ireland. We are still finalising IBIE’s day-to-day contact details and we will be in touch with these details in due course.
6. Who will regulate IBIE and what are their contact details?
The Central Bank of Ireland will be the competent regulator for IBIE (in the same way that the Financial Conduct Authority is the competent regulator for IBUK). The Central Bank of Ireland’s contact details are set out below:
Location
The Central Bank of Ireland
New Wapping Street
North Wall Quay
Dublin 1
D01 F7X3
Contact Numbers
Phone: +353 (0)1 224 6000
Fax: +353 (0)1 224 5550
Postal Address
Central Bank of Ireland
P.O. Box 559
Dublin 1
Public Helpline
E-mail: enquiries@centralbank.ie
Lo-Call: 1890 777 777
Phone: +353 (0)1 224 5800
7. Where does IBIE fit with respect to the broader Interactive Brokers group?
IBIE is a wholly-owned subsidiary that sits within the broader Interactive Brokers Group.
8. What does the Proposed Transfer mean for me? Will there be any material impacts?
We do not anticipate any material impacts for you as a result of the Proposed Transfer. Nonetheless, it is very important that you read this FAQs carefully and in full and make sure that you understand what the changes are for you.
9. What do I have to do if I want to continue doing business with Interactive Brokers?
If you would like to continue to do business with Interactive Brokers, we require your cooperation and action.
Specifically, we need you to consent and agree to the Customer Agreement and other Documents available under the Important Information section of the Proposed Transfer process and to the regulatory matters outlined in the Covering Letter, the Important Information and Consent sections of the Proposed Transfer process. You can do this by following the instructions in the Covering Letter.
To be clear, you do not have to consent to the Proposed Transfer if you feel that you may be adversely affected by it. However, you should be aware that if you decide to decline, IBUK may not be able to keep servicing your account at the end of the Brexit transition period. If that happens, your account will be restricted from opening new transactions or transferring new assets. You always have the ability to transfer your account to another broker. If you wish to decline, please follow the instructions in the Covering Letter.
In either case, we ask that you read the entirety of this FAQs and the Covering Letter before deciding to consent to or decline the Proposed Transfer.
10. What happens next?
If you consent to the transfer, please complete all actions detailed in the Covering Letter and we will prepare your account for the Proposed Transfer. Following the Proposed Transfer, IBIE will write to you with further information about your new relationship with them.
1. What terms and conditions will govern my relationship with IBIE following the Proposed Transfer? Are these different to the ones that currently apply?
Trades that you conduct after the Proposed Transfer will be governed by the new Customer Agreement between you and IBIE. A copy of the new Customer Agreement is available in the Important Information section of the Proposed Transfer process. Please see the response to Question A3 above in relation to the timing for the Proposed Transfer.
2. What conduct of business rules (including best execution) will apply to my relationship with IBIE? Are there any material differences that will apply to my relationship with IBIE compared to those that apply to my existing relationship with IBUK?
There are some changes to be aware of, which we explain below.
If you do business with IBUK on a “carried” basis (in other words, you trade index options, futures and futures options and IBUK carries your account and custodies your assets) then the Financial Conduct Authority’s conduct of business rules currently apply to you. These rules are based heavily on the recast Markets in Financial Instruments Directive, the Markets in Financial Regulation and various delegated directives and regulations (collectively, “MiFID”). In relation to best execution, where it applies, IBUK must take all sufficient steps to achieve the best possible result for you when we execute your order.
If you currently do business with IBUK on an “introduced” basis (in other words, you trade products outside of those mentioned in the previous paragraph and you have a relationship with both IBUK and its US affiliate, IBLLC), a mix of conduct of business rules will currently apply to you. For instance, with respect to the introduction of your business to IBLLC, the Financial Conduct Authority’s conduct of business rules will apply (see above in relation to these). Once introduced to IBLLC, the relevant U.S. Securities and Exchange Commission and U.S. Commodity Futures Trading Commission rules and regulations (among others) will apply to IBLLC’s role (including its obligations in relation to best execution and custody).
Please note that it is of course possible that your business is split across these two scenarios (in other words some of your business is conducted on a “carried” basis while some of it is conducted on an “introduced” basis).
Going forward, the distinction between “carried” and “introduced” business will no longer apply and in each case set out above, Irish conduct of business rules will exclusively apply to your relationship with IBIE. Similar to the UK Financial Conduct Authority’s rules, the Irish conduct of business rules are based on MiFID and IBIE’s obligations in relation to best execution will largely mirror those that currently apply to IBUK.
In our view, while the rules that apply to our relationship will change, we do not consider such changes to be material or to result in a lesser degree of protection being afforded to you.
3. How will my investments that I custody with IBIE be held from a legal/regulatory perspective? Are there any material differences that will apply to my relationship with IBIE compared to those that apply to my existing relationship with IBUK?
The rules that currently apply depends on the sort of business that you presently have with IBUK (please see the response to Question B2 above). Where you conduct “carried” business with IBUK, the Financial Conduct Authority’s client asset (or “CASS”) rules will apply. These rules are based heavily on MiFID. Where you conduct “introduced” business with IBUK and IBLLC, the US custody rules will apply to your custody assets.
Going forward, as set out above, the distinction between “carried” and “introduced” business will no longer apply and in each case set out above, Irish custody rules will exclusively apply to your relationship with IBIE. Like the UK Financial Conduct Authority’s rules, the Irish conduct of business rules are based on MiFID. Please consult the Client Assets Key Information Document attached in the Important Information section in relation to the Irish custody regime.
4. How am I protected against loss? Are there any material differences that will apply to my relationship with IBIE compared to those that apply to my existing relationship with IBUK?
Currently, your eligible assets are protected from loss either under the US Securities Investor Protection Corporation at an amount of up to USD 500,000 (subject to a cash sublimit of USD 250,000) or the UK Financial Services Compensation Scheme at an amount up to £50,000 (which regime applies depends on the relevant segment of your IBUK account, as explained in the response to Question B2 above). After the Proposed Transfer, the Irish Investor Compensation Scheme, which is administered by The Investor Compensation Company DAC, may protect your assets from loss should IBIE default and be unable to meet its obligations to you.
Ireland’s compensation scheme is similar to the compensation scheme you have access to in the UK, albeit with a lower limit. The purpose of the Irish Investor Compensation Scheme is to pay compensation to you (subject to certain limits) if you have invested money or investment instruments in either of the following cases:
The Investor Compensation Company DAC (ICCL) administers the scheme. IBIE will be a member of the scheme.
The scheme covers investment products including:
Usually, you can only make a claim after a firm goes out of business and its assets have been liquidated and distributed to those who are owed money. Please check the details of the schemes for any limits that apply – not all losses will be covered as there are maximum levels of compensation. The ICCL will pay you compensation for 90% of the amount you have lost, up to a maximum of €20,000.
5. How do I make a complaint to IBIE? Are there any material differences that will apply to my relationship with IBIE compared to those that apply to my existing relationship with IBUK? What if my complaint relates to something that happened while I was a customer of IBUK?
The new Customer Agreement sets out how to lodge a complaint with IBIE. The complaints handling procedures are materially similar to those that apply to your existing relationship with IBUK. If the substance of your complaint relates to something that happened prior to the Proposed Transfer, then you should address your complaint to IBUK. IBUK will remain authorised as an investment firm post-Brexit. Its current contact information will stay the same should you need to contact IBUK.
6. After the Proposed Transfer, will I still have access to the Financial Ombudsman Service?
In case of complaint, investors should follow the complaints procedure as referred to in the Customer Agreement. As explained in the Original FAQs, once the Proposed Transfer has taken place, the UK Financial Ombudsman Service will cease to have jurisdiction over any complaints that you may have in respect of IBUK. However, please be aware that Ireland has a dispute resolution scheme in the form of the Financial Services and Pensions Ombudsman (“FSPO”) The FSPO is a free and independent statutory dispute resolution scheme for financial services. You may be eligible to make a complaint to the FSPO if you are an “eligible complainant”. Details of who are “eligible complainants” can be found on www.fspo.ie. The FSPO can be contacted at:
Postal Address
Financial Services and Pensions Ombudsman
Lincoln House,
Lincoln Place
Dublin 2
D02 VH29
Telephone
+353 (0)1 567 7000
7. How will my personal data be processed and protected? Are there any material differences that will apply to my relationship with IBIE compared to those that apply to my existing relationship with IBUK in this context?
Please see the Original FAQs for further information. In summary there will be no material change.
1. Who should I contact before the Proposed Transfer takes place and after the Proposed Transfer if I have any questions in the ordinary course?
Generally speaking, you should contact IBUK with any questions that you may have prior to the Proposed Transfer, and you should contact IBIE with any questions that you may have following the Proposed Transfer taking place. Regardless of who you contact at Interactive Brokers, we will ensure your query is promptly dealt with and we will help you to connect with the right person or department.
2. Will the range of products offered be the same?
Our current expectation is that the same range of products will be offered by IBIE as are offered by IBUK.
There might be a restriction on Foreign Exchange transactions that would create a negative balance or would increase a preexisting negative balance in either component currency (i.e., "Leveraged Forex"). However, the same currency pairs can be traded as a Forex CFD. Contracts For Difference are complex instruments, and we invite you to carefully review the CFD risk warnings before trading these instruments following the transfer of your account.
Please note that IBIE offers financing for securities and commodities trades but cannot support withdrawals of borrowed funds. You will be free to withdraw any free cash not needed to support your open positions. If you would like to withdraw additional funds, you can sell positions and withdraw the proceeds.
3. I currently trade OTC derivatives with IBUK – what will happen to my open positions?
Your open positions will be transferred to IBIE and you will face IBIE rather than IBUK. You will no longer have any legal relationship with IBUK in relation to those positions. We will separately provide you with an updated Key Investor Information Document (please follow the link to the PRIIPs KID landing page in the Covering Letter).
4. What happens to any security I have granted to IBUK/IBLLC as part of a margin loan?
If you have granted security or collateral to IBUK/IBLLC this will transfer to the new Irish entity – IBIE - upon the Proposed Transfer taking place.
We do not anticipate you needing to take any steps to reflect the change in beneficiary, although we may need to take some administrative steps of our own to update security registers with the change in details. This should, however, not affect our priority or otherwise affect the date from which the security is valid.
5. Will I have access to the same trading platform or be subject to any software changes following migrations?
The migration will have no impact upon the software you use to trade or administer your account. The technology will remain the same as it is today.
6. Will all account balances be transferred at the same time?
All balances, with the exception of accruals (e.g., interest, dividends) will be transferred at the same time. Once accruals have been posted to cash, they will automatically be swept to the migrated account.
7. What will happen to my current account following migration?
Once all accruals have been swept, your current account will be closed and inaccessible for trading purposes. You will still be able to access this closed account via the Client Portal for purposes of viewing and printing archived activity and tax statements.
8. Will IBKR’s commissions and fees change when my account is migrated?
No. IBKR commissions and fees do not vary by the broker your account is maintained with.
9. Will my trading permissions change when my account is migrated?
Subject to the Leveraged Forex limitation discussed in (2) above, we do not expect any changes to your trading permissions when your account is migrated.
10. Will open orders (e.g., Good-til-Canceled) be carried over when my account is migrated?
Open orders will be not carried over to the new account and we recommend that clients review their orders immediately following the migration to ensure that the open orders are consistent with their trading intentions.
11. Will I be subject to the U.S. Pattern Day Trading Rule once my account is migrated?
Accounts maintained with IBUK are subject to the U.S. Pattern Day Trading (PDT) rule as the accounts are introduced to and carried by IBLLC, a U.S. broker. The PDT rules restricts accounts with equity below USD 25,000 to no more than 3 Day Trades within any 5-business day period.
As accounts migrated to IBIE will not be introduced to IBLLC, they will not be subject to the PDT rule.
12. Will I receive a single, combined annual activity statement at year end?
No. You will receive an annual statement of your existing account which will cover the period starting January 1, 2020 through the date of migration and a second annual statement for your new account which will cover the period starting from the migration date through the end of the year.
13. Will the current cost basis of positions be carried over when my account is migrated?
Yes, this migration will have no impact upon the cost basis of your positions.
14. Will the migrated account retain the same configuration as the current account?
The configuration of the account following migration will match that of the current account to the extent permissible by regulation. This includes attributes such as margin capability, market data, additional users, and alerts. In limited instances, an account will be migrated to a jurisdiction where the full scope of product eligibility cannot be offered. Client’s holding restricted products may migrate and maintain or close such positions but won’t be allowed to increase the position.
15. Will my login credentials change?
No. Your username, password, and any 2-factor authentication process in place for your existing account will remain active following migration. You will, however, be assigned a new account ID for your migrated account.
This is an important document regarding the proposed transfer of your account from IBUK and IBLLC to IBLUX that requires your attention. Please read the entirety of this document ahead of taking any action referred to in the Covering Letter sent to you via email.
Please take time to read this article, which summarises some of the key changes to the regulatory framework brought about by the Proposed Transfer (as described below) and provides answers to some more general questions you may have. It should be read in conjunction with the Covering Letter sent to you via email and to which it was linked. If you require any further information, please get in touch with us using the contact details provided in that Covering Letter. This article supersedes the one previously made available to you titled “FAQs: Brexit Account Migration” (“Original FAQs”) as it reflects new information and we ask that you read it carefully. To the extent there is any inconsistency between this article and the Original FAQs, please rely on the information contained in this article.
Discussion:
This Information Leaflet is split into three parts.
1. What is the situation currently and why do things have to change?
As you would be aware, at present, your relationship with Interactive Brokers is led by our entity based in the United Kingdom, specifically Interactive Brokers (U.K.) Limited (“IBUK”) and the services provided to you are provided by IBUK and, depending on the products you do business in, our US affiliate Interactive Brokers LLC (“IBLLC”). At present IBUK utilises what is known as a financial services passport to be able to perform its part of the service provision across continental Europe. Our working assumption is that following the end of the Brexit transitional period later this year, IBUK will lose the ability to do so and that from 1 January 2021 Interactive Brokers will need to make some changes in relation to which legal entity does business with you.
2. What are the “changes” envisaged above?
We have established a new Interactive Brokers legal entity in Luxembourg, specifically, Interactive Brokers Luxembourg SARL (“IBLUX”). The proposal is to transfer the business that you currently conduct with IBUK and IBLLC to IBLUX. In other words, it is our intention that all of your accounts, investments and services currently provided by IBUK and IBLLC will instead be singularly provided by IBLUX (for convenience we will refer to this as the “Proposed Transfer”).
3. When will the Proposed Transfer occur?
We will write to you again ahead of the Proposed Transfer.
4. Who is IBLUX? What sort of a firm is it?
IBLUX was granted authorisation by the Luxembourg Financial Sector Supervisory Commission (Commission de Surveillance du Secteur Financier, CSSF) to operate as an investment firm in November 2019. IBLUX’s regulatory status and profile is very similar to IBUK’s. This is because both IBLUX and IBUK are authorised pursuant to the second Markets in Financial Instruments Directive. This is an EU-wide piece of legislation whose purpose is to, as much as possible, harmonise how investment firms are regulated.
This does not mean there are not some differences between the regulations that apply to your relationship at present and those that will apply once your account is transferred. We explain these in more detail in Part B of this article.
5. What are IBLUX’s legal details?
Interactive Brokers Luxembourg SARL is registered as a private company limited by shares (société à responsabilité limitée) (registration number B229091) in the register of companies for Luxembourg. Its registered address is 4, rue Robert Stümper, L - 2557 Luxembourg. We are still finalising IBLUX’s day-to-day contact details and will be in touch with these in due course.
6. Who will regulate IBLUX and what are their contact details?
The Luxembourg Financial Sector Supervisory Commission (CSSF) is the competent regulator for IBLUX (in the same way that the Financial Conduct Authority is the competent regulator for IBUK). The Luxembourg Financial Sector Supervisory Commission’s (CSSF) contact details are set out below:
Location
Commission de Surveillance du Secteur Financier
283, route d’ArlonL-1150
Luxembourg
Postal Address
Commission de Surveillance du Secteur Financier
L-2991 Luxembourg
7. Where does IBLUX fit with respect to the broader Interactive Brokers group?
IBLUX is a wholly-owned subsidiary that sits within the broader Interactive Brokers Group.
8. What does the Proposed Transfer mean for me? Will there be any material impacts?
We do not anticipate any material impacts. Nonetheless, it is very important you read this article and make sure you understand what the changes are.
9. What do I have to do if I want to continue doing business with Interactive Brokers?
If you would like to continue to do business with Interactive Brokers we require your cooperation and action.
Specifically, we need you to consent and agree to the Customer Agreement and other Documents attached to the Covering Letter and to the regulatory matters outlined in the Covering Letter. You can do this by following the instructions in the Covering Letter.
To be clear, you do not have to consent to the Proposed Transfer if you feel you may be adversely affected by it. However, you should be aware that if you decide to decline, IBUK will likely not be able to keep servicing your account at the end of the Brexit transition period. If that happens, your account will be put in liquidation and we will ask you to transfer your assets to another broker. If you wish to decline, please follow the instructions in the Covering Letter.
In either case, we ask that you read the entirety of this Information Leaflet and the Covering Letter before deciding to consent to or decline to the Proposed Transfer.
10. What happens next?
If you consent to the transfer, please complete all actions detailed in the Covering Letter and we will prepare your account for the Proposed Transfer. Following the Proposed Transfer, IBLUX will write to you with further information about your new relationship with them.
1. What terms and conditions will govern your relationship following the Proposed Transfer? Are these different to the ones that currently apply?
Trades that you conduct after the Proposed Transfer will be governed by the new Customer Agreement between you and IBLUX. A copy of the new Customer Agreement will be presented to you online when you are provided with an opportunity to consent. Please see question A3 above in relation to the timing for the Proposed Transfer.
2. What conduct of business rules (including best execution) will apply to my relationship with IBLUX? Are there any material differences that apply to my relationship with IBLUX when compared to my existing relationship led by IBUK in this context?
There are some changes to be aware of, which we explain below.
If you do business with IBUK on a “carried” basis (in other words, you trade index options, futures and futures options and IBUK carries your account and custodies your assets) then the Financial Conduct Authority’s conduct of business rules currently apply to you. These rules are based heavily on the recast Markets in Financial Instruments Directive, the Markets in Financial Regulation and various delegated directives and regulation (collectively “MiFID”). In relation to best execution, where it applies, IBUK must take all sufficient steps to achieve the best possible result for you when we execute your order.
If you currently do business with IBUK on an “introduced” basis (in other words, you trade products outside of those mentioned in the previous paragraph and you have a relationship with both IBUK and its US affiliate, IBLLC) a mix of conduct of business rules currently apply to you. For instance, with respect to the introduction of your business to IBLLC, the Financial Conduct Authority’s conduct of business rules apply (see above in relation to these). Once introduced to IBLLC, the relevant U.S. Securities and Exchange Commission and U.S. Commodity Futures Trading Commission rules and regulations (among others) apply to IBLLC’s role (including its obligations in relation to best execution and custody).
Note more generally that it is of course possible that your business is split across these two scenarios (in other words, some of your business is conducted on a “carried” basis while some of it is conducted on an “introduced” basis).
Going forward, the distinction between “carried” and “introduced” business will no longer apply and in each case set out above, Luxembourg conduct of business rules will exclusively apply to your relationship with IBLUX. Like the UK Financial Conduct Authority’s rules, these are based heavily on MiFID and IBLUX’s obligations in relation to best execution mirror those that currently apply to IBUK.
In our view, while the rules that apply to our relationship will change, we do not consider such changes to be material or to result in a lesser degree of protection being afforded to you.
3. How will my investments that I custody with IBLUX be held from a legal/regulatory perspective? Are there any material differences that apply to my relationship with IBLUX when compared to my existing relationship led by IBUK in this context?
The rules that currently apply depends on the sort of business you presently have with IBUK (see B2 above). Where you conduct “carried” business with IBUK the, Financial Conduct Authority’s client asset (or “CASS”) rules will apply. These are based heavily on MiFID. Where you conduct “introduced” business with IBUK and IBLLC, the US custody rules will apply to your custody assets.
Going forward, as set out above, the distinction between “carried” and “introduced” business will no longer apply and in each case set out above, Luxembourg custody rules will exclusively apply to your relationship with IBLUX. Like the UK Financial Conduct Authority’s rules, these are based heavily on MiFID.
4. How am I protected against loss? Are there any material differences that apply to my relationship with IBLUX when compared to my existing relationship led by IBUK in this context?
Currently your eligible assets are protected from loss either under the US Securities Investor Protection Corporation or the UK Financial Services Compensation Scheme (which regime applies depends on the relevant segment of your IBUK account, as explained above in B2). After the Proposed Transfer, the Luxembourg Investor Compensation Scheme (Système d’indemnisation des investisseurs, SIIL) will protect your assets from loss should IBLUX default and be unable to meet its obligations to you.
Luxembourg’s compensation scheme is similar to the compensation scheme you have access to in the UK, albeit with a lower limit. The purpose of the Luxembourg Investor Compensation Scheme (Système d’indemnisation des investisseurs, SIIL) is to pay compensation to you (subject to certain limits) if you have invested money or investment instruments in either of the following cases:
The scheme is operated by the Luxembourg financial markets authority (Commission de Surveillance du Secteur Financier, CSSF) and managed by the Council of protection of depositors and investors (Conseil de protection des déposants et des investisseurs, CPDI). If a member firm of the scheme goes out of business and cannot return your money or investment instruments, you may be able to claim compensation from the scheme.
IBLUX is a member of the scheme.
The scheme covers investment products including:
Usually you can only make a claim after a firm goes out of business and its assets have been liquidated and distributed to those who are owed money. Check the details of the schemes for any limits that apply – not all losses will be covered as there are maximum levels of compensation. The Luxembourg Investor Compensation Scheme (Système d’indemnisation des investisseurs, SIIL) will pay you compensation for the amount you have lost, up to a maximum of €20,000.
5. How do I make a complaint to IBLUX? Are there any material differences that apply to my relationship with IBLUX when compared to my existing relationship led by IBUK in this context? What if my complaint relates to something that happened while I was a customer of IBUK?
The new Customer Agreement sets out how to lodge a complaint with IBLUX. The procedures are materially similar to those that apply to your existing relationship with IBUK. If the substance of your complaint relates to something that happened prior to the Proposed Transfer, then you should address your complain to IBUK. IBUK will remain authorised as an investment firm post-Brexit. Its current contact information will stay the same should you need to contact IBUK.
6. Will I still have access to the Financial Ombudsman?
In case of a complaint, investors should follow the complaints procedure as referred to in the Customer Agreement. Once the Proposed Transfer has taken place, the UK Financial Ombudsman Service will cease to have jurisdiction over any complaints.
7. How will my personal data be processed and protected? Are there any material differences that apply to my relationship with IBLUX when compared to my existing relationship led by IBUK in this context?
There will be no material change.
1. Who should I contact before the Proposed Transfer takes place and after the Proposed Transfer if I have any questions in the ordinary course?
Generally speaking, you should contact IBUK with any questions prior to the Proposed Transfer and you should contact IBLUX with any questions following the Proposed Transfer. Regardless of who you contact at Interactive Brokers, we will ensure your query is promptly dealt with and will help you to connect to the right person or department.
2. Will the range of products and services offered be the same?
Our current expectation is that the majority of products that can be traded in the IBUK account will be offered by IBLUX. However, there are some limitations. However, IBLUX will not offer the ability to transact leveraged foreign exchange or to adhere to the Stock Yield Enhancement Programme that is currently available to you. Clients that are residents of Luxembourg will also be restricted from trading Bonds.
Please note that IBLUX offers financing for securities and commodities trades but cannot support withdrawals of borrowed funds. You will be free to withdraw any free cash not needed to support your open positions. If you would like to withdraw additional funds, you can sell positions and withdraw the proceeds
To the extent you are impacted by this, we will separately get in touch with you.
3. I currently trade OTC derivatives with IBUK – what will happen to my open positions?
Your open positions will be transferred to IBLUX and your position will face IBLUX rather than IBUK. You will no longer have any legal relationship with IBUK in relation to those positions.
We will separately provide to you an updated Key Information Document (please follow the link to the PRIIPs KID landing page in the Covering Letter).
4. What happens to any security I have granted IBUK as part of a margin loan?
If you have granted security or collateral to IBUK/IBLLC, it will transfer to IBLUX upon the Proposed Transfer. We do not anticipate you needing to take any steps to reflect the change in beneficiary, although we may need to take some administrative steps of our own to update security registers with the change in details. This should, however, not affect our priority or otherwise affect the date from which the security is valid.
5. Will I have access to the same trading platform or be subject to any software changes following migration?
The migration will have no impact upon the software you use to trade or administer your account. The technology will remain the same as it is today.
6. Will all account balances be transferred at the same time? What will happen to my current account following migration?
All balances, with the exception of accruals (e.g., interest, dividends) will be transferred at the same time. Once accruals have been posted to cash, they will automatically be swept to the migrated account
7. What will happen to my current account following migration?
Once all accruals have been swept, your current account will be closed and inaccessible for trading purposes. You will still be able to access this closed account via the Client Portal for purposes of viewing and printing archived activity and tax statements.
8. Will IBKR’s commissions and fees change when my account is migrated?
No. IBKR commissions and fees do not vary by the broker your account is maintained with.
9. Will my trading permissions change when my account is migrated?
Following migration, you will be restricted from engaging in leveraged forex transactions.
10. Will open orders (e.g., Good-til-Canceled) be carried over when my account is migrated?
Open orders will not be carried over to the new account, and we recommend that clients review their orders immediately following the migration to ensure that the open orders are consistent with their trading intentions.
11. Will I be subject to the U.S. Pattern Day Trading Rule once my account is migrated?
12. Will I receive a single, combined annual activity statement at year end?
No. You will receive an annual statement for your existing account which will cover the period starting January 1, 2020 through the date of migration and a second annual statement for your new account which will cover the period starting from the migration date through December 31, 2020.
13. Will the current cost basis of positions be carried over when my account is migrated?
Yes, this migration will have no impact upon the cost basis of your positions.
14. Will the migrated account retain the same configuration as the current account?
The configuration of the account following migration will match that of the current account to the extent permissible by regulation. This includes attributes such as margin capability, market data, additional users and alerts. In limited instances, an account will be migrated to a jurisdiction where the full scope of product eligibility cannot be offered. Client’s holding restricted products may migrate and maintain or close such positions but won’t be allowed to increase the position.
Boerse Stuttgart and Clearstream Banking have announced that they will no longer provide services for issues whose main business is connected directly or indirectly to cannabis and other narcotics products. Consequently, those securities will no longer trade on the Stuttgart (SWB) or Frankfurt (FWB) stock exchanges. Effective as of the 19 September 2018 close, IBKR will take the following actions:
Outlined in the table below are impacted issues as announced by the Boerse Stuttgart and Clearstream Banking as of 7 August 2018. This table includes a notation as to whether the impacted issue is eligible for transfer to a U.S. listing. Note that the clearinghouses have indicated that this list may not yet be complete and clients are advised to review their respective websites for the most current information.
ISIN | NAME | EXCHANGE | U.S. TRANSFER ELIGIBLE? | U.S. SYMBOL |
CA00258G1037 |
ABATTIS BIOCEUTICALS CORP |
FWB2 | YES |
ATTBF |
CA05156X1087 |
AURORA CANNABIS INC |
FWB2, SWB2 | YES |
ACBFF |
CA37956B1013 |
GLOBAL CANNABIS APPLICATIONS |
FWB2 | YES |
FUAPF |
US3988451072 |
GROOVE BOTANICALS INC |
FWB | YES |
GRVE |
US45408X3089 |
INDIA GLOBALIZATION CAPITAL |
FWB2, SWB2 | YES |
ICG |
CA4576371062 |
INMED PHARMACEUTICALS INC |
FWB2 | YES |
IMLFF |
CA53224Y1043 |
LIFESTYLE DELIVERY SYSTEMS I |
FWB2, SWB2 | YES |
LDSYF |
CA56575M1086 |
MARAPHARM VENTURES INC |
FWB2, SWB2 | YES |
MRPHF |
CA5768081096 |
MATICA ENTERPRISES INC |
FWB2, SWB2 | YES |
MQPXF |
CA62987D1087 |
NAMASTE TECHNOLOGIES INC |
FWB2, SWB2 | YES |
NXTTF |
CA63902L1004 |
NATURALLY SPLENDID ENT LTD |
FWB2, SWB2 | YES |
NSPDF |
CA88166Y1007 |
TETRA BIO-PHARMA INC |
FWB2 | YES |
TBPMF |
CA92347A1066 |
VERITAS PHARMA INC |
FWB2 | YES |
VRTHF |
CA1377991023 |
CANNTAB THERAPEUTICS LTD |
FWB2 | NO | |
CA74737N1042 |
QUADRON CANNATECH CORP |
FWB2 | NO | |
CA84730M1023 |
SPEAKEASY CANNABIS CLUB LTD |
FWB2, SWB2 | NO | |
CA86860J1066 |
SUPREME CANNABIS CO INC/THE |
FWB2 | NO | |
CA92858L2021 |
VODIS PHARMACEUTICALS INC |
FWB2 | NO |
IMPORTANT NOTES:
In order for your ACAT or ATON transfer to be completed successfully, your broker must validate the account number provided on the request. If the account number is invalid, your broker will reject the request. IBKR recommends that clients review a copy of their brokerage statement to confirm their account number and has provided statement samples below from some of the more common brokers highlighting where this information can be found.
Charles Schwab - Broker #0164. Account Number convention is 8 characters, all numeric.
Fidelity Investments - Delivers through National Financial Services, Broker #0226. Account Number convention is 9 characters, first 3 alpha-numeric and last 6 numeric.
Merrill Edge - Broker #0671. Account Number convention is 8 characters, combination of alpha and numeric.
TD Ameritrade - Broker #0188. Account Number convention is 9 characters, all numeric.
Vanguard- Broker #0062. Account Number convention is 8 characters, all numeric.
Note: This article contains images of sample broker statements which are for illustrative purposes only and which may contain logos that remain the property of each of those brokers.
Introduction
To comply with regulations regarding the sale of unregistered securities and to minimize the manual processing associated with trading shares that are not publicly quoted, IBKR imposes certain restrictions on U.S. Microcap Stocks. A list of those restrictions, along with other FAQs relating to this topic are provided below.
Microcap Restrictions
Microcap FAQs
What is a U.S. Microcap Stock?
The term “Microcap Stock” refers to shares (1) traded over the counter or (2) that are listed on Nasdaq and NYSE American that have a market capitalization of between $50 million to $300 million and are trading at or below $5. For purposes of this policy, the term Microcap Stock will include the shares of U.S. public companies which have a market capitalization at or below $50 million, which are sometimes referred to as nanocap stocks or trade on a market generally associated with Microcap Stocks.
To avoid situations where minor, short-term fluctuations in a stock price cause repeated reclassification, any stock classified as U.S. Microcap will remain in that classification until both its market capitalization and share price exceed $300 million and $5, respectively, for a 30 consecutive calendar day period.
As Microcap Stocks are often low-priced, they are commonly referred to as penny stocks. IBKR may make exceptions, including for stocks traded at low prices that recently had a greater market cap. In addition, IBKR will not consider ADRs on non-US companies to be Micro-Cap stocks.
Where do Microcap Stocks trade?
Microcap Stocks typically trade in the OTC market, rather than on a national securities exchange. They are often electronically quoted by market makers on OTC systems such as the OTC Bulletin Board (OTCBB) and the markets administered by the OTC Markets Group (e.g., OTCQX, OTCQB & Pink). Also included in this category are stocks which may not be publicly quoted and which are designated as Caveat Emptor, Other OTC or Grey Market.
In addition, U.S. regulators also consider stocks listed on Nasdaq or NYSE American trading at or below $5 with a market capitalization at or less than $300 million to be Microcap Stocks.
What happens if IBKR receives a transfer from an Eligible Client where one or more of the positions transferred is a Microcap Stock?
If IBKR receives a transfer containing a block of a Microcap stock, IBKR reserves the right to restrict the sale of any Microcap position(s) included in the transfer unless the Eligible Client provides appropriate documentation establishing that the shares were either purchased on the open market (i.e., on a public exchange through another broker) or were registered with the SEC pursuant to an S-1 or similar registration statement.
Eligible Clients can prove that shares were purchased on the open market by providing a brokerage statement or trade confirm from a reputable broker reflecting the purchase of the shares on a public exchange. Eligible Clients can establish that the shares are registered by providing the SEC (Edgar system) File number under which their shares were registered by the company (and any documents necessary to confirm the shares are the ones listed in the registration statement).
NOTE: All customers are free to transfer out any shares we have restricted at any time.
What restrictions will IBKR apply to Prime accounts?
Clients whose activities include Prime services are considered Eligible Clients solely for the purposes of those trades which IBKR has agreed to accept from its executing brokers. However, while Prime accounts may clear U.S. Microcap Stocks at IBKR, those shares will be restricted until such time IBKR confirms that the shares are eligible for re-sale under the procedures discussed above.
To remove the restriction for shares purchased on the open market, please have the executing broker provide a signed letter on company letterhead or an official Account Statement stating that the shares were purchased in the open market. The letter or statement must also include the below required criteria. Alternatively, if the shares were acquired through an offering the letter or statement must provide documents or links to the relevant registration statement and state that the shares were part of it.
Required Broker Letter Criteria:
1) IBKR Account Number
2) IBKR Account Title
3) Trade Date
4) Settlement Date
5) Symbol
6) Side
7) Price
8) Quantity
9) Time of Execution
10) Exchange
11) Must be signed
12) Must be on Firm's official letterhead
To summarize: Sell Long trades will be accepted if the long position is no longer restricted. Sell Short trades will be accepted. Buy Long trades will be accepted and the position will be restricted until Compliance is provided with sufficient information to remove the restriction. Buy Cover trades and intraday round trip trades will not be accepted.
What happens if a stock you purchase gets reclassified as Grey Market or Caveat Emptor?
If you purchase a stock in your IBKR account that at a later date becomes classified as a Caveat Emptor or Grey Market stock, you will be allowed to maintain, close or transfer the position but will not be able to increase your position.
What are some of the reasons why Microcap Stock trading may be restricted in my account?
There are two primary reasons why you might be restricted from trading in a Microcap Stock:
If one of the above reasons apply, trading will be restricted in the security and a notification will be sent to the customer’s message center in Account Management. This notification will describe the reason for the restriction and the steps the customer must take before IBKR will consider lifting the restriction.
Why does IBKR consider me to be a potential affiliate of a Microcap Stock issuer?
An “affiliate” is a person, such as an executive officer, a director or large shareholder, in a relationship of control with the issuer.
Rule 144 applies to all securities, including Microcap Stocks. However, given the heightened risks associated with trading Microcap Stocks, if a customer’s trading and/or holdings in a Microcap Stock are close to the Rule 144 Thresholds, IBKR will restrict the customer’s trading in the Microcap Stock. This restriction will remain in effect pending a compliance review into the customer’s potential affiliate status.
For the Potential Affiliate review, why do I need to ask for a new review every two weeks?
A customer’s affiliate status may change soon after IBKR completes the above-referenced Potential Affiliate review. As such, IBKR believes it is appropriate to refresh a Potential Affiliate review every two weeks if a customer’s trading activity and/or holdings in the Microcap Stock remain close to the Rule 144 Thresholds.
Where can I find a list of stocks that IBKR has designated as U.S. Microcaps?
A list of stocks designated as U.S. Microcaps by IBKR is available via the following link: www.ibkr.com/download/us_microcaps.csv
Note that this list is updated daily.
Where can I find additional information on Microcap Stocks?
Additional information on Microcap Stocks, including risks associated with such stocks may be found on the SEC website: https://www.sec.gov/reportspubs/investor-publications/investorpubsmicrocapstockhtm.html
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1This includes transfers by any method (e.g., ACATS, DWAC, FOP), conversion of Canadian listings to their U.S. equivalent via “Southbound” transfer, transfers to cover existing short positions, IB Prime customers executing with other brokers and clearing to IBKR, etc.
If you have been informed or believe that your account profile contains an incorrect US SSN/ITIN, you may simply log into your Account Management to update this information. Depending on your taxpayer status, you can update your US SSN/ITIN by modifying one of the following documents:
1) IRS Form W9 (if you are a US tax resident and/or US citizen holding a US SSN/ITIN)
2) IRS Form W-8BEN (if you are a Non-US tax resident holding a US SSN/ITIN)
Please note, if your SSN/ITIN has already been verified with the IRS you will be unable to update the information. If however the IRS has not yet verified the ID, you will have the ability to update through Account Management.
How to Modify Your W9/W8
1) To submit this information change request, first login to Account Management
2) Click on the Settings section followed by Account Settings
3) Find the Profile(s) section. Locate the User you wish to update and click on the Info button (the "i" icon) to the left of the User's name
4) Scroll down to the bottom where you will see the words Tax Forms. Next to it will be a link with the current tax form we have for the account. Click on this tax form to open it
5) Review the form. If your US SSN/ITIN is incorrect, click on the UPDATE button at the bottom of the page
6) Make the requisite changes and click the CONTINUE button to submit your request.
7) If supporting documentation is required to approve your information change request, you will receive a message. Otherwise, your information change request should be approved within 24-48 hours.
Overview
The Direct Registration System (DRS) allows shareholders to register their U.S. share holdings on the books and records of the issuer in an electronic rather than paper certificate form through the issuer’s designated transfer agent. Once held in a DRS account, the shares may then be transferred electronically via the Depository Trust Company (DTC) to your IB account where transactions may take place or where the shares may be afforded margin loan value.
It should be noted that not all shares are DRS eligible. In general, most U.S. exchange traded securities are, but many OTC shares, as well as shares subject to a restriction and therefore held in certificate form, are not.
Transfer Process
To deposit shares held in your DRS account to your IB account you will need to log into Account Management and create transfer instructions. These instructions require that you provide IB with certain information regarding your DRS account (e.g., account number and taxpayer ID) which you will need to obtain from and/or confirm with your transfer agent. It’s important that you provide IB with information which matches that of your DRS account, otherwise your transfer agent will reject the request and you will be charged a rejection fee. Information regarding fees for rejected as well as settled transactions are posted on the website.
Once the DRS account information has been confirmed, log into Account Management and proceed as follows:
1. Select the Funding and then Position Transfers menu options;
2. From the Position Transfer screen, select a transfer method of DRS-Direct Registration System and transfer type of Deposit via the drop-down menus;
3. You’ll be directed to the DRS Transfer screen where the taxpayer ID you’ve provided to IB is displayed. If this does not match that which you maintain for your DRS account, you will first need to reconcile and correct the information so it matches prior to proceeding with the transfer request. Requests submitted with a mismatched taxpayer ID will result in the transfer being rejected by your transfer agent and your account being subject to a rejection processing fee;
4. Enter your DRS account number and click the Continue button. Note that requests submitted with an account number that doesn't match that of your DRS account will result in the transfer being rejected by your transfer agent and your account being subject to a rejection processing fee;
5. Enter the symbol of the security you intend to transfer as well as the share quantity. Note that requests submitted with a symbol not held within or a share quantity which exceeds that held in your DRS account will result in the transfer being rejected by your transfer agent and your account being subject to a rejection processing fee;
6. Enter your electronic signature and click the “Continue” button to confirm your transfer request.
IB will then notify DTC who will match the security to its associated transfer agent and send them notification of your request. Assuming the DRS account and share information you’ve provided is correct, the transfer agent will post the shares for delivery to IB. Note that while transfer requests typically settle within 2 -5 business days, the transfer agent may take longer to respond to the notification and, if no response is received within 30 days, the request will be canceled.
IMPORTANT NOTE
If you are transferring shares from a joint account or are a non-US person, special consideration needs to be provided to the taxpayer ID you provide to IB for matching to your DRS account. In the case of a joint account, the ID will generally be one of the SSNs of the joint account holders or a default value of 999999999. In the case of a non-US person, where no US taxpayer ID exists, a default value of 111111111 is often used. In either case, you will need to verify with the transfer agent the identifier they will recognize for matching purposes. If the transfer agent requests an identifier which doesn’t match one of the elections provided within Account Management, please contact Customer Service for transfer assistance.