NSD E-voting Electronic voting system

The technology of electronic vote E-voting is a versatile tool for vote, it allows owners of securities not only to participate remotely in the shareholder meetings held in the form of joint presence but also to vote at the meetings held in absentia.

Use of E-voting service for shareholders free.

Service allows shareholders:

• be registered at a meeting and vote in electronic form (by filling of an electronic form of the bulletin on the website www.e-vote.ru);
• watch web broadcast of a meeting or text broadcasting (depending on the choice of the issuer);
• get acquainted with the agenda and materials of a meeting;
• support online communication with the issuer during the meeting.

For access to E-voting special technical means are not required, connection to the platform is possible from any place in the world in the presence of the Internet. Service is available to all categories of shareholders regardless of where their securities — are stored in the register or in depositary. If the investor is the shareholder of several societies using E-voting, he can vote without additional costs through services of a single platform.

The E-voting platform represents the ready-made solution which issuers can integrate with the computer systems and also with the systems of registrars.

When using E-voting the issuer and his counting board obtain data on shareholder voting online. For counting of votes and decision making there is an opportunity to consider timely as voices of the shareholders who are present at a meeting personally, and voting far off through an electronic voting system. Document flow between issuers, registrars and central depository is performed on the basis of the international ISO formats implemented by NSD within reform of corporate actions. It allows to provide end-to-end process automation at all stages of holding meetings.

2017: Participation in the DataArt project

The platform for e-proxy-voting gives to owners of securities the chance to monitor all process of vote. Each participant sees where his voice left and whether it was counted correctly. The data obtained as a result of system operation are unchangeable and completely audited.

The system developed jointly by DataArt and NSD meets the requirements of finance regulators. It can be used as an alternative to traditional vote using bulletins and participation of counting board.

The next stage development of the platform — carrying out the first votes and adaptation of a system for work with users. In case of successful experience of application, the platform can become open source for national depositaries of other countries.

The system concept looks as follows. On the eve of vote the fixed quantity of the tokenized voices is issued. These voices extend on nominee holders and develop in purses in the protected way. Participants of vote send them directly in a system to purses pro, contra or "refrained".

Legal entities act as participants of vote: registrars, nominee holders (banks), depositaries. They connect the clients to the distributed register of vote.

A system is created on the basis of Hyperledger Fabric blockchain technology. Feature of the project was the fact that DataArt for the first time implemented zero-knowledge-proof technology in the platform. It gave the chance to cryptographic check correctness of the restricted information, saving confidentiality of participants of vote.

2016

Prototype of an electronic voting system on the basis of a blockchain

"National Settlement Depositary" (NSD), central depository of the Russian Federation, completed development and tested in the spring of 2016 a prototype of an electronic voting system of e-proxy voting on the basis of technology of the distributed registers (blockchain). The prototype is developed based on the network distributed cryptographic NXT platform, for message exchange uses the international standard ISO 20022. Development was conducted together with DSX Technologies company. Its results are available in the form of an open source code (open-source) on GitHub.

E-proxy voting represents advanced technology of carrying out corporate actions at which information exchange and documents between the owner of securities and the issuer happens in electronic form, told in depositary. In NSD of e-proxy voting it was for the first time implemented in August, 2014, and in April, 2015 the technology was optimized and brought into accord with the international standards ISO. In April, 2016 e-proxy voting prototype on the basis of a blockchain in relation to holding a meeting of bond holders was tested.

"The last 10 years the global financial infrastructure faced the calls requiring cardinal review of approaches to reliability, security and high-speed performance of information systems. It is obvious to us that to ignore rapid development of FinTech (financial technologies), being limited only to updating of promptly outdate platforms, it is dangerous in terms of stable development of a financial system of the country. Fortunately, Russian specialists are one of strongest in the global industry of FinTech that we once again proved, having successfully implemented the working prototype of electronic vote on the basis of a blockchain — Eddie Astanin, the chairman of the board of NSD said. — After implementation of a blockchain for meetings of bond holders this experience can be extended also to other activities of NSD".

How it works

According to representatives of NSD, the existing technology of electronic vote means message exchange by a cascade through chains of nominee holders from the issuer to the owner of securities and in the opposite direction. The NSD in this chain maintains a register of vote, providing transfer and calculation of instructions for vote. e-proxy voting prototype on the basis of a blockchain registers instructions at once in the distributed register which is supported at the same time by all participants of a chain.

"Having analyzed within the working group several options of application of a blockchain to different fields of activity of NSD, we stopped the choice on automation of vote of owners of securities at annual general meetings. In 4 months we could create a working prototype of electronic vote on the basis of a blockchain. During tests it was succeeded to reach speed in 80 instructions for vote per second. Now we work on increase in capacity and support of new types of vote — Sergey Putyatinsky, the CIO of NSD told. — The next step — conducting legal and cryptographic examinations of a new prototype according to the results of which we will study a possibility of carrying out real votes".

The distributed register of electronic vote contains the complete history of updates protected from distortions by cryptographic enciphering. At the same time copies of the register are stored at all participants of network (nominee holders, NSD), and or to the auditor it is rather simple to the regulator to join this network to get full access to all information, necessary for checks. The data written in a blockchain once cannot be forged — any changes of the procedure or results of vote in the distributed register register, their copies extend among all participants of network and can be easily checked, developers emphasized.

As explained in "National settlement depositary", the owner of the security votes in a personal web office on the portal of the nominee holder using the electronic signature. The nominee holder records the owner's voice in a blockchain, having complemented with the electronic signature. As receipt acknowledgment of a voice the nominee holder provides to the owner the identifier of its voice in the distributed register. Further record about a voice of this owner consistently is signed by nominee holders on a chain to central depository. At the time of completion of vote a system automatically counts results, and the NSD publishes them in a blockchain using the electronic signature. At the same time use of cryptographic mechanisms allows to protect intermediate results of vote.

Participation in the project RT Labs

RT Labs conduct development of the system of electronic vote – e-Voting which will allow to automate process of participation of holders of securities/shareholders in the meetings, votes taken by issuers of these papers. The project is implemented by request of NPO of JSC NSD (National Settlement Depositary) and also can be demanded by the companies with a large number of shareholders.

For access to a system it was necessary to become authorized on the website http://e-vote.ru using the confirmed account of the Uniform Gosuslug Portal - www.gosuslugi.ru or through the one-time login and the password provided by a registry holder of PJSC Sberbank - JSC Status.

In addition to vote shareholders, using functionality of the platform, could get acquainted remotely with the agenda and materials for a meeting, to be connected to its web broadcasting.

For access to service special technical means were not required, and connection to it was possible from any place in the world that it is especially relevant for shareholders of Bank whose geography of presence includes all regions of Russia and the country of the FSU and beyond.

The e-voting platform providing a possibility of use of personal vote in electronic form when holding general meetings of owners of securities was developed by NSD together with RT Labs, Rostelecom subsidiary company.

During creation of e-voting were applied a technology stack, ensuring stable system operation at high loads, software open source and Agile methodology. A system is developed taking into account adaptive imposition that allows to work in it via personal computers, tablet and mobile devices.

Implementation in the Russian market of service of electronic vote e-voting became possible after adoption of Federal law No. 210-FZ which since July 1, 2016 fixed application of such method of vote at shareholder meetings.