Reduced Protections for Professional Clients
PART 1: General Overview
1.1 Notification for Professional Clients
Professional Clients receive fewer protections under the Astana International Financial Centre's Conduct of Business Rules [AIFC RULES NO. FR0005 OF 2017] (referred to as "Applicable Law") compared to Retail Clients.
1.2 Purpose of This Document
CaspianEx provides this notification as a transparent written warning about the potential loss of protections when choosing to be classified as a Professional Client rather than a Retail Client.
1.3 Document's Limitations
This Document is a summary and may not capture all details. Though accurate when released, regulatory requirements might change. While CaspianEx strives to keep the information current and will host the latest version on its website, we're not obligated to inform you about updates.
1.4 Definitions
Terms in this notification are consistent with their definitions in the Applicable Law unless specified otherwise. Within the context of this document, Top Line Limited—the entity operating and owning CaspianEx—is categorized as an Authorised Firm per the Applicable Law.
1.5 Importance of Understanding
It's crucial to thoroughly review and comprehend this notification before agreeing to be categorized as a Professional Client.
PART 2: Client Communications
2.1 Fairness and Clarity in Communications
Objective: Ensure that all communications remain transparent, just, and unambiguous.
CaspianEx's Commitment: All interactions involving: (a) Client communications concerning any Financial Product or Service, or (b) Any Financial Promotion overseen or endorsed by CaspianEx, shall be conducted in a manner that is fair, clear, and free from deception.
2.2 Maintaining Regulatory Accountability
Objective: Uphold our duties and responsibilities without evading our regulatory obligations.
CaspianEx's Stance: No communication or Financial Promotion approved or sent out by CaspianEx will aim to circumvent or minimize any obligation or responsibility we owe to our Clients or any third party under the relevant AIFC Rules or Regulations.
Noteworthy Distinction: Communication methods with Professional Clients may vary from those with Retail Clients. The depth, method, and timeliness of the information CaspianEx provides will differ based on the Client's classification, whether Professional or Retail.
2.3 Direct Communication with Clients
Objective: Ensure direct and unmediated information dissemination as mandated by Applicable Law.
CaspianEx's Protocol: All necessary information, as stipulated by the Applicable Law, is presented directly to the Client. Exceptions are made only if the Client provides written directions to communicate with another individual or entity.
Scope of Communication: This encompasses, but isn't restricted to, Financial Promotions, client agreements, terms of service, conditions of Financial Products, mandates, powers of attorney established for Financial Product or Service purposes, and all other communications wholly or partly linked to the offering of a Financial Product or Service.
PART 3: Unsolicited Real Time Financial Promotions
3.1 Scope
Professional Clients Exemption: Professional Clients are not bound by the limitations of Unsolicited Real Time Financial Promotion. They are presumed to possess the capability to evaluate the risks associated with Financial Products or Services, even in direct dialogue with a CaspianEx representative.
3.2 Definition of Unsolicited Real Time Financial Promotion
Criteria: A Financial Promotion is deemed an Unsolicited Real Time Financial Promotion if it involves live interaction:
(a) That: (i) Wasn't initiated by the Financial Promotion's recipient. (ii) Isn't a result of a direct request from said recipient.
(b) Or, where at the start or upon request of the dialogue, it wasn’t evident that discussions would touch on the types of controlled activities and investments as eventually discussed.
Typical Characteristics: Unsolicited Real Time Financial Promotions, requiring immediate recipient response, commonly include personal visits, phone calls, or other live dialogues. Given their inherent risk, Retail Clients are offered added protection against them, as opposed to solicited or non-live Financial Promotions.
Non-Real Time Promotions: Examples include emails, letters, websites, TV ads, or radio broadcasts. These lack the immediacy and interactive nature of live promotions.
3.3 Absence of Explicit Request for Live Financial Promotion
Criteria: A person does not explicitly request a live Financial Promotion if:
(a) They merely refrain from indicating unwillingness to continue or initiate dialogue. (b) They consent to standard terms indicating such dialogue, unless they've clearly shown willingness for said dialogue, beyond just agreeing to the terms.
Example: If a dialogue is initiated by a recipient (R), it's also deemed to be initiated for any other individual receiving it simultaneously with R, especially if that other recipient is related to R or expected to jointly invest with R.
3.4 Limitations on Investment Types
Criteria: Unsolicited Real Time Financial Promotions should only concern Investments which are:
- Government securities. (b) Listed securities
Exception: Real-time financial promotions relating to warrants or other securities that are derivatives are prohibited.
PART 4: Essential Information and Client Agreement
4.1 Scope
Exemption for Professional Clients: Although CaspianEx is not obligated to establish a written client agreement when dealing with Professional Clients for a Regulated Activity, it is still mandatory to provide essential information to them before delivering services as per this section.
4.2 Client Agreement Guidelines
4.2.1 Mandatory Information for Professional Clients
CaspianEx must provide and incorporate in the Client Agreement: (a) CaspianEx’s name and address, and the name and address of the ultimate Holding Company if CaspianEx is a Subsidiary. (b) CaspianEx's regulatory status. (c) Details regarding the inception, potential amendments, and termination of the Client Agreement. (d) Comprehensive information about fees, expenses, and other charges, along with the rationale for imposing these.
4.2.2 Optional Information for Professional Clients
CaspianEx may choose to provide or exclude in the Client Agreement: (a) Detailed descriptions of the services, including relevant data about any Financial Product, any limitations on CaspianEx, and the implications of these restrictions. If there aren't any restrictions, a corresponding statement is required. (b) Disclosures on potential conflicts of interest. (c) Main details about CaspianEx's complaint management procedures, along with an affirmation that these procedures are available free of charge upon request.
4.2.3 Relationship Between Essential Information and Client Agreement
CaspianEx can either: (a) Offer a copy of the proposed client agreement containing the essential information. (b) Present the essential information separately from the client agreement.
4.2.4 Provisions for Impracticable Situations
In situations where providing essential information or establishing a client agreement becomes unfeasible, CaspianEx can offer a Financial Product or Service to a Professional Client without these prerequisites if it:
(a) Explains the impracticability of drafting a client agreement.
(b) Proceeds to create a client agreement as swiftly as possible post-transaction.
Example: It might become unfeasible to offer essential information or form a client agreement if a Client needs CaspianEx to complete a transaction that's time-sensitive.
PART 5: Client Reporting
Exemptions in Trade Confirmations for Managed Investments
Context: Trade confirmations serve as formal acknowledgments sent by a broker to an investor, summarizing the crucial details of a trade, ensuring transparency and accuracy in investment activities.
Exemption Details: When CaspianEx undertakes a transaction as a part of its investment management service for a client, the general mandate for trade confirmations is waived. This exemption is rooted in the belief that within a managed investment scenario, the emphasis is on overall portfolio performance rather than individual transaction validations.
Tailored Reporting for Professional Clients
Significance of Customization: Recognizing the sophistication and unique requirements of Professional Clients, the standard format and timing of trade confirmations might not always be fitting or desired.
Customized Approach: CaspianEx, in its commitment to cater to the distinctive needs of Professional Clients, offers the flexibility to customize transaction reporting. This includes, but isn't limited to, modifying the content depth, frequency, delivery method, and timing of the confirmations. It allows for a more dynamic and client-centric approach, ensuring that the Professional Clients receive information in a manner most beneficial and relevant to their investment strategies and objectives.
Advantages: This tailored approach not only ensures a higher level of client satisfaction but also streamlines communication, making it more efficient and in line with the client's preferences and operational rhythm.