Collective safe custody

(1) The custodian may entrust fungible securities that are admitted to collective safe custody by a central securities depository to that depository for collective safe custody, unless the depositor has, under section 2, first sentence, required separate safekeeping of the securities. Instead of collective safe custody by a central securities depository, the custodian may itself keep the securities undivided from its own holdings of the same kind or from those of third parties, or entrust them to a third party for collective safe custody, where the depositor has expressly authorised it to do so in text form. The authorisation may neither be contained in the custodian's terms of business nor refer to other documents; it must be given separately for each custody transaction.
(2) Instead of taking the deposited certificate into collective safe custody, the custodian may transfer to the depositor a corresponding co-ownership share in the collective holding.
(3) Section 3 applies to collective safe custody with a third party.
(4) Central securities depositories may entrust securities to a foreign custodian for collective safe custody, within the framework of a reciprocal account relationship agreed for the purpose of establishing cross-border book-entry securities transactions, provided that
1. the foreign custodian performs the functions of a central securities depository in its home state and is subject to public supervision or other supervision equivalent for investor protection purposes,
2. the depositor is granted, in respect of the collective holding of that custodian, a legal position equivalent to that under this Act,
3. no prohibitions of the home state of the foreign custodian stand in the way of the central securities depository's claim against the foreign custodian for delivery of the securities, and
4. the securities are fungible and admitted to collective safe custody by the central securities depository and the foreign custodian within the framework of their reciprocal account relationship. The liability of central securities depositories under section 3(2), first sentence for a fault of the foreign custodian may not be limited by agreement.