Evidence and transfer of securities without written instrument
Until 1996, all securities including listed securities were transferred through the delivery of paper documents to the company or its registrar. The London Stock Exchange operated a service facilitating the collection, the sorting and the delivery of transfer documents. The transfer service which operated until 1996 was referred to as TALISMAN.
The stock market crash in 1987 caused trading volumes to soar. TALISMAN was unable to cope with this surge and collapsed. It was resolved then to replace paper documents with electronic instructions. The replacement is often referred to as 'dematerialisation'. Dematerialised share transfers became possible in July 1996 when the CREST transfer system went live.
Since then, the London Stock Exchange is no longer involved in the settlement of shares. Securities that are traded on the London Stock Exchange need to be available for electronic settlement.1 They are transferred through CREST.
Dematerialisation was made possible