How to become CHESS Sponsored

In order to become CHESS sponsored, a broker-client sponsorship agreement must be in place. The following process outlines how this occurs:

1. Ring up the selected broker of your choice (Refer our Brokers Guide for a list) and ask them to open a new account for you. Usually, they will get your information over the phone and send you out a starter pack outlining all the features, options and tools they can provide you with – and why the firm you have selected are the best. This pack will also contain a broker-client sponsorship agreement form which outlines their responsibilities to you and your responsibilities to them. Complete this form if you are satisfied with it and send it back to the broker.
2. This agreement between you and the broker must be in place before any of your holdings can be established on CHESS subregister.
3. Your selected broker will then notify CHESS that an agreement is in place between you and the CHESS sponsor that is representing you on the stock market. The broker does this by sending an electronic message that contains your registration details to CHESS for validation.
4. CHESS validates the message, and if accepted, returns a message to the broker which includes all your information and more important a newly assigned Holder Identification Number (HIN).
5. CHESS then notifies you of your registration acceptance by sending a “New Sponsorship Notification” advice form which contains your new HIN, registration details, PID (Personal Identifier Code).
6. The agreement authorizes the CHESS sponsor you have chosen to represent your transactions on the stock market, subject to the broker-client sponsorship agreement.
7. You can be sponsored by as many participants as you wish but you must remember that each particular holding of shares your purchase can only have one sponsor. For example, if you purchase 1,000 AMP shares – you could hold 500 of these under a National Australia Bank trading account and 500 of these on Commsec trading account
   • However, these holdings will be recorded under separate HIN details on the CHESS subregister and you would be required to sign separate broker-client sponsorship agreements.

It is important to note that as a client – you are not bound to stay at one particular broker although usually it is better to do the research first before swapping and change brokers for the best price. You can elect to terminate your broker-client agreement at any time by giving your CHESS sponsor written notification of your wishes to terminate your agreement. In your notification you may want to include your desire to become issuer-sponsored or perhaps transfer your CHESS holdings to another CHESS sponsor.