BALKANADVISORYCOMPANY – IPEAD, Sofia, 9, Pozitano Street, Entrance A, Building 2
Floor 5, Office 15
GENERAL TERMS AND CONDITIONS
OF
BALKANADVISORYCOMPANY – IPEAD
APPLICABLE TO
AGREEMENTS WITH CLIENTS
PREAMBLE
I. GeneralinformationofBalkanAdvisoryCompany – IPEAD
BalkanAdvisoryCompany – IPEADisasole-ownedjointstockcompanyregisteredatSofiaCityCourtandfiledintheTradeCompaniesRegisterundercompany file No. 6253/2003, lot No. 77374, volume 913, Reg. I, page 179 (hereinafter referred to as the “Company” or “Investment Mediator”)
TheCompanyislicensedtooperateasaninvestmentmediatorby Resolution No.RG-03-0206 asof 03.06.2003, issuedaccordingtoResolutionNo. 90-IPasof 28.05.2003, ResolutionNo. 562-ИП asof 22.12.2003, andResolutionNo. 169-IP as of 08.03.2006 of the Financial Supervision Commission (FSC).
BalkanAdvisoryCompany – IPEADhasthefollowingregisteredscopeofactivity, according to the license issued by FSC:
- Acceptance and delivery of orders regarding securities including mediation for conclusion of securities transactions;
- Execution of purchase and sale orders for securities at client’s expense;
- Provision of individual investment advisory services to any client as a result of own initiative or by request of the client in reliance with one or more transactions regarding securities transactions;
- Offering of securities for initial sale with no unconditional and irrevocable obligation for the acquisition of the securities at its own expense;
-Holding and administration of securities at clients’ expense including trust activity (holding of clients’ securities and money in depositary institution) and the associated with that services such as administration of deposited money/provided securities;
-Granting of loans for the purpose of securities transactions provided that the loan grantor participates in the transaction in compliance with the terms and order determined in an ordinance;
-Consultancy for companies in regard to the capital structure, industrial strategy and related matters, as well as consultancy and services associated with merger and purchase of enterprises;
-Transactions with foreign means of payment to the extent the latter are relevant to the investment services provided;
-Investment researches and financial analyses as well as any other type of general recommendations in regard to the securities transactions;
-Provision of services regarding offering of securities for initial sale with no unconditional and irrevocable obligation for acquisition of securities at one’s own expense.
The above activities shall be performed in compliance with all applicable licenses and registrations as well as any other requirements, provided by Bulgarian legislation.
Upon the issuance of a new license to BalkanAdvisoryCompany – IPEAD, pursuanttotheprovisionsofthe Markets in Financial Instruments Act(„MFIA”), the scope of the activity of the investment mediator automatically acquires the following adjustment without changing these Genera Terms and Conditions:
а) Performanceofinvestment services and activities on the territory of the Republic of Bulgaria and abroad, as follows:
1. Acceptanceanddeliveryofordersregardingoneormorefinancialinstrumentsincludingmediationforconclusionoftransactionsinfinancialinstruments;
2. Executionofordersat client’s expense;
3. Portfolio management;
4. Provision of investment consultancy to a client;
5. Offeringoffinancialinstrumentsforinitialsalewithnounconditionalandirrevocableobligationfortheacquisitionofthefinancialinstrumentsatitsownexpense;
6. Organization of multiple trading system.
b) PerformanceofthefollowingadditionalservicesandactivitiesontheterritoryoftheRepublicofBulgariaandabroad:
1. Holding and administration of financial instruments at clients’ expense including trust activity (holding of clients’ financial instruments and money in depository institution) and the associated with that services such as administration of deposited money/provided securities;
2. Grantingofloansforthepurposeofexecutingtransactionsinoneormorefinancialinstrumentsprovidedthattheloangrantorparticipatesinthetransactionincompliancewiththetermsandorderdeterminedinanordinance;
3. Consultancyforcompaniesinregardtothecapitalstructure, industrialstrategyandrelated matters, aswellasconsultancyandservicesassociatedwithmergerandpurchaseofenterprises;
4. Investment researches and financial analyses as well as any other type of general recommendations in regard to the transactions infinancialinstruments;
5. Provision of services regarding offering of securities for initial sale with no unconditional and irrevocable obligation for subscription/acquisition of securities at one’s own expense;
6. Underletter „а” andsections 1-6 inreliancetothebasicassetofderivativefinancialinstrumentswithinthemeaningofArt. 3, s. 2, letters „d”, „e”, „f” and „i” of MFIA, as long as they are related to the provision of services under sections 1-5 of letter „b”.
c) Transactionswithforeignmeansofpaymentincashand "non-cash" under a license obtained according to the terms and procedures of the applicable law.
AllservicesandactivitiesstatedintheCompany’sscopeofactivitiesmaybeperformedabroadincompliancewiththeprovisionsofthelocallegislation. The servicesandactivitiesstatedintheCompany’sscopeofactivitiesmaybeperformedwithin the European Union or European Economic Space by establishing a branch and according to the conditions of free provision of services.
ThecapitalofBalkanAdvisoryCompany – IPEADamountstoBGN 200 000 (two hundred thousand).
TheTaxNumberofBalkanAdvisoryCompany – IPEADis 1222133250, and its Identification Code under BULSTAT is 131112767.
II. BALKAN ADVISORY COMPANY – IPEAD BUSINESS PRINCIPLES
Initscapacityofaninvestmentmediator, BalkanAdvisoryCompany – IPEADwillconstantlyapplythefollowingprinciples, in compliance withtotheprovisionsoftheMarkets in Financial Instruments Act(„MFIA”) andRegulationNo. 38 as of 25.07.2007 on the requirements to the investment mediators’ activity issued by the Financial Supervision Commission („Regulation No. 38”).
1. BalkanAdvisoryCompany – IPEADshallworkfairlyandhonestlyasaprofessional, acting bona fideinthe bestinterests of itsclients.
2. BalkanAdvisoryCompany – IPEADshalltreatequallyallitsclientsandinformthemoftherisksofthetransactions in financial instruments.
3. BalkanAdvisoryCompany – IPEADshallconcludetransactions in financialinstrumentsatitsclients’ expenses, onmarketconditionsmostfavourablefortheclients,andmakeitsbesteffortstoperformaccordingtotheclient’s instructions.
4. BalkanAdvisoryCompany – IPEADshallexecuteclientordersaccordingtoitsadoptedpolicyforexecutionofclientorders,andtimelynotifyitsclientsofanychangesinthispolicy.
5. BalkanAdvisoryCompany – IPEADshallkeepitsclients’ goodwilland tradesecrets, whichwerecommunicatedtoituponorduetotheexecutionoftheorders.
6. Theinformation, whichBalkanAdvisoryCompany – IPEADshallsubmittoitsclientsandpotentialclients, includingtheinformationintheadvertisingmaterialsandpublicstatementsofitsBoardofDirectorsandthepersons, workingforitaccordingtoanemploymentagreement, shallbeunderstandable, true, correct, clear and not misleading. The informationandpublicstatementsofthe investment mediator’sBoardofDirectorsandthepersons, workingforitaccordingtoanemploymentagreement and related to its business, shall comply with the other provisions of Regulation No. 38, the respective provisions of Market Abuse with Financial Instruments Act Закона срещу пазарните злоупотреби с финансови инструменти (MAFIA) and the provisions of Distance Financial Services Act Закона за предоставяне на финансови услуги от разстояние DFSA) – in case the Company concludes an agreement for provision of distance financial services within the meaning of Art.6 of DFSA.
7. BalkanAdvisoryCompany – IPEADshallnotifyitsclientsoftheexistingcompensationsystemofinvestorsinfinancialinstruments, includingitsscopeandguaranteedamountoftheclientassets, and, uponrequest, providedataonthecompensationtermsandprocedures.
8. BalkanAdvisoryCompany – IPEADshalldetermineitsclientsasprofessional, non-professional,andacceptablecounterparty, accordingtothecriteriasetforthinMFIA.
9. BalkanAdvisoryCompany – IPEADshallstrictlyobservetherulesapplicableintheplaces, whereitexecutes theorders (regulatedmarket, multipletradingsystem),and the loyal competition principles.
10. BalkanAdvisoryCompany – IPEADshallnotjoinclientordersortransactionatclient’sownexpensewithotherclientorders, expectforthecasesallowedbythelawandinaccordancewiththepolicyfor execution of client orders adopted by the investment mediator and in client’s best interest.
11. BalkanAdvisoryCompany – IPEADshallenterallclientordersandtheirwithdrawalintoaspecialledgerinorderoftheiracceptance, includingtheidenticalorders. Inthesameledger, BalkanAdvisoryCompany – IPEADshallregisterconcludedtransactions in financialinstruments, inorderoftheirexecution, untiltheendofeachbusinessday.
12. ThemembersoftheBoardofDirectorsofBalkanAdvisoryCompany – IPEAD, itsemployeesandallotherpersonsworkingforBalkanAdvisoryCompany – IPEAD, includingtheones, whoarenotworkingnoworwhoseworkhasbeensuspended, shallnotcommunicatetoanyone, unlessauthorizedtodoso, andshallnotusefortheirbenefitoranythirdparty’sbenefit,anyfactsandcircumstancesrelatedtotheavailablefundsandoperationsundertheclients’ financialinstrumentaccountsandmoney, oranyotherfactsandcircumstances, whicharetradesecret, andwhichwerecommunicatedtothemduringtheperformanceoftheirprofessionalduties. ApartfromtheFSC, theDeputyChairpersonmanaging “InvestmentActivitySupervision” Directorate, andtheauthorizedofficialpersonsintheFSCadministrationandthestockexchange, wheretheCompanyisamember, forthepurposesoftheircontrolwithinthescopeoftheinspectionorder, the investment mediator may give information under the previous sentence only after obtaining the consent of its client or by order of a competent government body, issued in the cases specified by the law.
13. BalkanAdvisoryCompany – IPEADshallfollowanefficientpolicyforpreventionoftheconflictofinterests.
14. IfBalkanAdvisoryCompany – IPEADconcludesanagreementforprovisionofdistancefinancialserviceswithinthemeaningofArt.6 of DFSA,orinitiatesnegotiationstoconcludesuchanagreement, thisagreementshallbegovernedbytherelevantprovisionsof DFSA, including, but not limited to:
14.1. Company’sobligationstoprovidetheclientwithinformationon:
BalkanAdvisoryCompany – IPEAD;
Thefinancialservicesofferedtotheclientaccordingtotheagreementforprovisionofdistancefinancialservices;
Theagreementforprovisionofdistancefinancialservices, aswellasanyotherinformationpursuanttoArt.8, par.1, s.4 of DFSA;
14.2. Company’sobligationsrelatedtotheactions, whichtheCompanymustperformbeforetheclienthasbeenboundbyanofferoranagreementforprovisionofdistancefinancialservices;
14.3. Therequirements, whichthetradeannouncementsusedbyBalkanAdvisoryCompany – IPEAD must satisfy.
15. Theprovisionsof DFSA shallapplytoanypossibledisputerelatedtoanagreementforprovisionofdistancefinancialservices.
16. Theinvestmentadvice, whichBalkanAdvisoryCompany – IPEADgivestoitsclients, shallbereasonable, notbasedonexaggeratedfavourablefactsorunconsideredunfavourablefactsandnotmotivatedonlybythedesiretoobtainremuneration. Theprognosesintheinvestmentadviceshallbewell-grounded, explicitlystatedasprognoses, andtheconditions, onwhichtheyarebasedandwhichsignificantlyaffecttheirexecution, shallalsobementioned.
17. Therecommendationsonthefinancialinstruments, whichBalkanAdvisoryCompany – IPEADgives, shallbefairlypresentedanddisclosetheinterests (conflict of interest), which occur forBalkanAdvisoryCompany – IPEAD. The Company shall make the due efforts to guarantee that:
Thefactsareclearlydifferentiatedfromanyinterpretations, assessments, opinionsandotherinformation, whichisnotrelatedtothesubmissionoffacts;
Theinformationsources are reliable. Iftheirreliabilityisdoubtful, thisfactshallbeclearlymentioned;
Allpredictions, prognosesandexpectedpricesareclearlystatedasbeingsuch, andthesignificantassumptionsmadeduringtheirpreparationorusearealsomentioned;
Allmaininformationsourcesarestated, includingtherespectiveemitterofthefinancialinstrument, towhichtherecommendationdirectlyorindirectlyrefers, aswellasthefactiftherecommendationhasbeensubmittedtotheemitter andchangedduetothesubmissionandbeforebeingcirculated;
Eachbasisforevaluationormethodologyusedforevaluationoffinancialinstrumentsorfinancialinstrumentemitter, orforquotationoftheexpectedpriceoffinancialinstruments, ispresentedtotheinvestorsclearlyandunderstandably;
Themeaningofeachrecommendationonthepurchase, saleorholdingoffinancialinstruments, whichmayalsoincludethevalidity term of therecommendation, isexplainedtotheinvestorsclearlyandunderstandablyand contains warning of any relative risk, including sensitivity analysis of the respective assumptions;
Theupdatingfrequencyoftherecommendation, ifplanned, andallmaterialchangesinthescopeofthestatedpolicy, arementioned;
Thedate, whentherecommendationwasfirstcirculated, andthedateandtimeofeachpricestatedforafinancialinstrument, isclearlystatedinawellvisibleplace;
Whentherecommendationisdifferentfromthepreviousrecommendationrelatedtothesamefinancialinstrumentsoremitter, issuedovertheprevious 12 monthsbeforethepublicationofthesecondrecommendation, thisdifferenceandthedateoftheearlierrecommendationare isclearlystatedinawellvisibleplace.
18. Apartfromtherequirementsunders.17 above,anduponthepreparationandcirculationofrecommendations, BalkanAdvisoryCompany – IPEADshall comply with the provisions of Chapter Three, Section IV ofMarket Abuse with Financial Instruments Act.
19. Noperson, whichhasany internalinformationasaresultofitsmembershipintheCompany’smanagementorcontrolbodies, itsparticipationinthecapitalorvotesintheGeneralAssemblyoftheCompany, itsaccesstoinformationduetoitsposition, professionorduties, orwhich has acquiredinformationthroughcrimeorotherunlawfulmeans, shallnotusethisinformationbyacquisitionortransfer, or attempt of acquisition or transfer at its account or any third party’s account, of the financial instruments, to which this information refers.Whentheperson, holdinginternalinformation, isalegalentity, theprohibitionofusingsuchinformationreferstoanyindividual, whichparticipatesinmakingthedecisiontoconcludeatransactiononat the account of thelegalentity. Theprovisionoftheprevioussentenceshallnotapplytotransactions, whichwereconcludingfortheperformanceoftherequiredobligationsto acquire and transfer financial instruments, when such obligations have occurred before the person has acquired the internal information.
20. Thepersons, holding anyinternalinformation, shallnot:
Disclosetheinternalinformationtoanotherperson, unlessthedisclosureismadeduringtheusualperformanceoftheiroffice, professionorduties;
Recommendorconvinceathirdpartyonthebasisoftheinternalinformationtoacquireortransferthefinancial instruments, to which this information refers.
21. Theprohibitionsunders.19 ands.20 shallapplytoanypersonapartfromthepersonsstatedins. 19, whichhasinternalinformationandknowsormustknowthatthisinformationisinternal.
22. Theprovisionsofs.19 - 21 shallalsoapplytothefinancialinstruments, whichhavenotbeenadmittedtotradeonaregulatedmarketintheRepublicofBulgariaoranotherMemberState, butwhosevaluedependsonthefinancialinstruments, whichhavebeenadmittedtotradeonsuchmarkets.
23. The investment mediator shall not manipulate the market in financial instruments.
24 TheinvestmentmediatorshallimmediatelyinformtheFinancialSupervisionCommissionaboutanycaseofanytransactionsinfinancialinstruments, whicharereasonablysuspectedtobetradeininternalinformationormanipulationofthemarketinfinancialinstruments.
ІІІ. PRE-CONTRACTUALRELATIONS. CLIENTCLASSIFICATION. INFORMATION EXCHANGE BETWEEN CLIENT AND INVESTMENT MEDIATOR (EVALUATION OF SUITABLE SERVICE)
III.1. Pre-ContractualRelations
1. Theinvestmentmediatorshalladoptapolicyforexecutionofclientorderstothebestinterestsofitsclients,timelyupdateitandsubmitthecurrentversiontotheminthemostappropriatemanner.
2. Thepolicyundertheprevioussectionshallincludetheinformationontheplacesforexecutionofclientorders (typeoffinancialinstrument), advantagesanddisadvantagesofeachplaceofexecution (according to the scope, price and costs of execution), and the places, in which the mediator may achieve the best execution. Theexecution policy shall include at least the places, which allow the investment mediator to obtain the best possible results for the execution of the client orders.
3. Theinvestmentmediatorshallnotexecuteordersattheexpense of its clients, iftheyhavenotgiventheir priorconsent, accordingtothepolicy, which the mediator has adopted.
ІІІ.2. ClientClassification
Atthebeginningandduetoinformationexchangeunders.ІІІ.3. below, theinvestmentmediatorshallobligatorilyclassifyitsclientsintooneofthefollowinggroups:
(а) acceptable counterparty;
(b) professional client:
1. Clients, whichthelawdeterminesasprofessional, unlessthesameagreeotherwisewiththeinvestmentmediator (see this provision below and Art.5)
2. Clients, whichsatisfytheRulesandCriteriaforClientClassificationofBalkanAdvisoryCompany – IPEAD – AttachmentNo.1 herein,andexplicitlyhaverequestedtobeclassifiedassuch;
(c) non-professionalclient.
Thestandardofduecarebytheinvestmentmediatormustbehighestintheworkwiththenon-professionalclients, unlesstheinvestmentmediatorand the client agree in writing the same high standard in the cases stated in Art. 5 below. Classification shall be made according to AttachmentNo.1 herein. A client may be determined as professional only in reliance to certain products and/or services.
ІІІ.3. InformationExchangebetweenClientandInvestmentMediator (Evaluation of Suitable Service)
ІІІ.3.1. Beforeestablishinganycontractualrelationswithitspotentialclients, theinvestmentmediatorshallobligatorilyprovidethemwithinformation, accordingtoAttachmentNo. 2 herein.
ІІІ.3.2. Theinvestmentmediatorshallobligatorilycollectinformationfromitsclients, accordingtothefollowingconditions:
(а) Uponprovidingportfoliomanagementand/orinvestmentconsultancy, themediatorshallcollectinformationon:
1. Theclient’sinvestmentpurposes;
2. Theclient’sfinancialcapacitytotakethe investmentrisks, towhichitmaybeexposedduetoitsinvestmentpurposes;
3. Whethertheclient’sexperienceandknowledgeallowittounderstandtherisksunders.2.
Inthecases, whentheinvestmentmediatorhasclassifiedaclientasprofessionalinreliancetocertainproducts, transactionsandservices, theinvestmentmediatorhastherighttoacceptthatinrespecttosuch products, transactionsandservices, theclienthasthenecessaryfinancialcapacity, experienceandknowledge to understand the risks related to the set investment purposes, even if the client has not submitted any information under letter (а), s.2 and 3 above.
Notwithstandingtheprovisionsoftheparagraphabove, theinvestmentmediatorshallnothavetherighttorendertheservicesunderletter (а), if it has not required the information above from its clients.
(b) Uponprovidingservicesdifferentfromtheonesstatedinletter (а), theinvestmentmediatorshallobligatorilycollecttheinformationequaltotheinformationinletter (а), s.3 above, whosescopemaydifferattheinvestmentmediator’sdiscretioninthedifferentcases.
Theinvestmentmediatorshallinformitsclientsthattheprovisionofinformationunders.ІІІ.3 is to their best interests.
ІV. CONTENTS OF DUE CARE UPON EXECUTION OF CLIENT ORDERS
1. Iftheclienthasgivenexplicitinstructionsfortheentireorderorapartofit, itsinstructionsshallprevailupon thepolicyforexecutionofclientordersoftheinvestmentmediator, andthelattermustcomplywiththem.
2. If the client has not given any explicit instructions on the execution of a certain order, the investmentmediatorshall obligatorily makes its best efforts to provide its client with the best price, costs and execution opportunities, and all other conditions related to the execution of the order.
3. Complyingwiththeobligationtoachievethebestresultsforitsclients, theinvestmentmediatorshallexecutetheirordersassoonaspossible, unlessthisisobviouslyunprofitablyforthem.
4. Uponexecutionofanorderplacedbyanon-professionalclient, thebestexecutionoftheordershallbedeterminedbythetotalvalueofthetransaction, which includesthepriceofthefinancialinstrumentsandexecution-relatedcosts.
PART ONE
I. GENERAL PROVISIONS
Art. 1. TheseGeneralProvisionsshallapplytotheagreements, whichtheinvestmentmediator concludes withall its clients and whose subject is the provision of the following services:
1. Acceptanceanddeliveryofordersregardingfinancialinstrumentsincludingmediationforconclusionoftransactionsinfinancialinstruments;
2. Execution oforders for financial instruments purchase and saleat client’s expense;
3. Managementofindividualportfolio, includingfinancialinstruments, accordingtoanagreementconcludedwiththeclient, atitsonediscretion, withoutspecialinstructionsbytheclient;
4. Provision of individual investment consultancy to a client, at its own initiative or client’s request, related to one or more transactions in financial instruments;
5. Initial sale of financialinstrumentswithnounconditionalandirrevocableobligationfortheacquisitionofthefinancialinstrumentsatitsownexpense
6. Offeringoffinancialinstrumentsforinitialsalewithnounconditionalandirrevocableobligationforthesubscription/acquisitionofthefinancialinstrumentsatitsownexpense;
7. Holding and administration of financial instruments at clients’ expense including trust activity (holding of clients’ financial instruments and money at a depository institution) and the associated with that services such as administration of deposited money/provided securities;
8. Grantingofloansforthepurposeofexecutingtransactionsinfinancialinstrumentsprovidedthattheloangrantorparticipatesinthetransactionincompliancewiththetermsandorderdeterminedinanordinance;
9. Consultancyforcompaniesinregardtothecapitalstructure, industrialstrategyandrelated matters, aswellasconsultancyandservicesassociatedwithmergerandpurchaseofenterprises;
10. Investment researches and financial analyses as well as any other type of general recommendations in regard to the transactions infinancialinstruments;
11. Provision of services regarding offering of securities for initial sale with no unconditional and irrevocable obligation for subscription/acquisition of securities at one’s own expense;
12. Provision of services regarding offering of securities for initial sale with no unconditional and irrevocable obligation for acquisition of securities at one’s own expense.
13. Transactions with investment agreement, which are offered in public;
14. Transactions with futures and options.
Art. 2. (1) BalkanAdvisoryCompany – IPEADshallrendertheinvestmentand additionalservicesunderArt.1 attheclient’sexpensepursuanttoawrittenagreementandapplyingtheseGeneralConditions. The agreement shall explicitly refer to these General Conditions or they shall be adopted by the client in writing.
(2) Incaseofanydiscrepanciesbetweenthespecialprovisionsoftheagreementwithaclientandtheprovisionsofthe GeneralConditions, thefirstones shall prevail and apply to the relations between the parties, even when the respective provisions of these General Conditions have been explicitly cancelled.
(3) Theclient, respectively itsrepresentative, shallsigntheagreementunderpar. 1 inthepresenceof a person under par.3, after the identity of the client or its representative has been confirmed.
(4) ApersonfromtheInternalControlDepartmentoftheinvestmentmediatorshallcheckiftheagreementunderpar. 1 satisfytherequirementsofMFIA, the actsofitsimplementationandtheinternalactsoftheinvestmentmediator. Inthiscase, thepersonfromtheInternalControlDepartmentshallexecuteadocumentcertifyingthecheckuntiltheendofthebusinessday.
(5) Acopyoftheidentitycardoftheclient, respectivelyitsrepresentative, certifiedbyhimorapersonauthorizedtoconcludeagreementonbehalfoftheinvestmentmediator (with the sign „true to the original”, date and signature of the person performing the certification), shall remain in the archive ofBalkanAdvisoryCompany – IPEAD.
(6) Theagreementunderpar. 1 shallcontainthefullnamesandPINofthepersons, whoconcludeit, thecapacityofthepersonrepresentingBalkanAdvisoryCompany – IPEAD, dateandplaceofconclusion,theapplicableconditionsandtariffsofBalkanAdvisoryCompany – IPEAD, main rights and obligations of the parties and the information, which the mediator must provide.
Art.3. BalkanAdvisoryCompany – IPEADshallconcludeagreementsforprovisionofinvestmentand/oradditionalservicesandacceptclientordersonlythroughindividualsworkingforitpursuabnttoanemploymentagreementandarenot:
1. brokers, or
2. persons, whosatisfytherequirementsofArt. 3, s. 1 - 6 ofRegulationNo. 7 of 2003 ontherequirementstoindividuals, whodirectlyconcludetransactionsinfinancialinstrumentsandinvestmentconsultancyrelatedtofinancialinstrumentsaccordingtoanagreement, as well as the procedure of acquisition and withdrawal of the right to perform such activity, and who are filed in the register under Art.30, par.1, s.2 of the Financial Supervision Commission Act, or
3. executive members of the Board of Directors or procurists of the investment mediator.
Art.4 (1) Theconclusionofanagreementforprovisionofinvestmentoradditionalservicesthrougharepresentativeactinginthenameoftheclient, ispossibleonlyifthelattersubmitsanotarizedpowerofattorney, whichcontainstheauthorizationtoconductmanagementanddisposal of financial instruments and declarations by the attorney, the fact that he does not execute transactions in financial instruments by profession, and has not performed such transactions within one year before the conclusion of the agreement.
(2) BalkanAdvisoryCompany – IPEADshallnotconcludeagreementsforprovisionofinvestmentoradditionalservices, iftheclientisitsrepresentativeandhasnotsubmittedandsignedallnecessarydocuments, orifithassubmitteddocumentswithapparentwrongorincompletedata, orerrorsordiscrepancies, orifthereisanothercondition, whichraises suspicion of undue legitimating or representation. The investment mediator may not conclude such agreement if the other party is represented by an attorney, who has stated execution of transactions in financial instruments by profession.
Art.5. (1). BalkanAdvisoryCompany – IPEADshalldulynotifyallitsclientsoftheconditionsandcriteria, onthebasisofwhichitdeterminesthemasprofessionalandnon-professional, andtheconditions, accordingtowhichtheymaybedeterminedasacceptablecounterparty, andenablethemtoreviewAttachmentNo. 2 herein.
(2) Theinvestmentmediator, atitsowninitiativeoruponclient’srequest, may:
1. determineasprofessionalandnon-professionalaclient, whichinothercaseswouldbedetermineas acceptablecounterparty;
2. determineasnon-professionalaclient, whichhasbeendeterminedasprofessionalunders.ІІІ.2., letter „b”, s.1 above.
(3) Ifaperson, determinedasanacceptablecounterparty, wishesnottobetreatedassuch, andtheinvestormediatoragrees, thispersonshallbetreatedasaprofessionalclient, unlessithasexplicitlyrequestedtobetreatedasanon-professionalclient.
(4) Theprofessionalclientsunders.ІІІ.2., letter „b”, s.1 abovehavebeennotifiedthattheyhavetherighttorequestanamendmenttotheiragreementsinordertoreceivehigherprotection. Suchamendmentshallnotcreatemorepreferentialstatusthanthenon-professionalclients’ statusforthepersonwhorequestedit, orputothermediator’sclientsinunequal position. Theamendmentshallbemadebythewrittenmutualconsentofthepartiesundertheagreement, whichstatesitsdetailsandmeansthatthe client, which has requested it, shall be deemed a professional one for the purpose of these General Conditions and applicable law. If, pursuant to the General Conditons, Tariff or any otgher documents or rules, applicable to the business of the investment mediator, the professional clients have a relieved regime or a regime different from the one of the non-professional clients, such relieves shall not be used for the benefit of the client, who has requested the amendment, as of the signature of the agreement related to it.
Art.6. (1) Intheevents, whenBalkanAdvisoryCompany – IPEADconcludesatransactionattheexpenseofanon-professionalclient, whichisnotinperformanceofanagreementforindividualportfoliomanagement, itshallsendaconfirmationoftheconcludedtransactioninapermanentcarrier, assoonaspossible, butnotlaterthantheendofthefirstbusinessdayfollowingtheconclusionofthetransaction. Iftheinvestmentmediatorreceivestheconfirmationthroughathirdparty, theclientshallbenotifiednotlaterthanthefirstbusinessdayfollowingtheday, whentheinvestmentmediatorhasreceivedtheconfirmationfromthethirdparty.
(2) Theconfirmationunderpar. 1 mustcontainsuchpartofthefollowinginformation, whichisrelatedtothespecifictransaction:
1. identificationoftheinvestmentmediator, whichprovidesthe information;
2. client’sname/titleofanyotherformofidentification;
3. date and time of transaction conclusion;
4. type of the submitted order;
5. purposeof the order (buys, sells etc.);
6. place of order’s execution;
7. identificationof the financial instruments;
8. sells/buys indicator;
9. number;
10. single price;
11. total amount of the transaction;
12. totalamountofthecommissionsandcostsattheclient’sexpense, andindividualstatementofeachcosts, uponclient’srequest;
13. client’sobligationsrelatedtothetransactionsettlement, includingfinaltermforpaymentorsupply, anddetailsoftheaccount, towhichthetransfershallbemade, ifsuchdetailshavenotbecommunicatedearliertotheclient;
14. noticestatingthattheotherpartyunderthetransactionwiththeclientistheinvestmentmediator, otherpersonfromtheinvestmentmediator’sgroup, orotherclientoftheinvestmentmediator, unlesstheorderisexecutedbyatradingsystemadmittinganonymoustrade.
(3) When theorderisexecutedinparts, theinvestmentmediatormaysubmittotheclientinformationonthepriceofeachtransactionoraverageprice, pursuanttopar. 2, s. 9. Whentheaveragepriceissubmitted, uponrequestofthenon-professionalclient, theinvestmentmediatorshallsubmitinformation onthepriceofeachtransaction.
(4) Whenthetransactionunderpar. 1 isconcludedattheexpenseofaprofessionalclient, theinvestmentmediatorshallimmediatelyprovide itwith the materialinformationontheconcludedtransactioninapermanentcarrier.
(5) Ifthesettlementisnotexecutedonthestateddate, oranyotherchangeoccursintheinformationcontained intheconfirmation, theinvestmentmediatorshallnotifytheclientuntiltheendofthebusinessday, on whichithaslearnedofthechange.
(6) Uponrequest, theinvestmentmediatorshallprovidetheclientwithinformationonthestatusandexecutionoftheorder.
(7) Paragraphs 1 and 5 shallnotapplytoclientorders, whosesubjectmatterisbondsforfundingmortgageloansagreements, underwhichtheclientsareaparty, forwhichthecontractionconfirmationshallbemadeatthetimewhentheconditionsofthemortgageloanarecommunicated, butnotlaterthanone monthasoftheexecutionoftheorder.
(8) Theinvestmentmediatorshallhavetherighttosubmittheinformationunderpar. 2 byusingstandardcodes, provideditsubmits explanationoftheused codestotheclient.
(9) Intheeventsoforderssubmittedfornon-professionalclients, whosesubjectmatterisstocksandsharesofjointinvestmententerprises, whichareperiodicallyexecuted, theinvestmentmediatorshalltaketheactionsunderpar. 1 orprovidetheclientwiththeinformationrelatedtosuchtransactionsunderpar. 2 atleastonceevery 6 months.
(10) Iftheorderfromtheclientisacceptedthroughanelectronicsystem, theconfirmationunderpar. 1, respectively, theinformationunderpar. 3 - 5, shall be provided to the client through the same electronic system.
Art.7. (1) Fortheexecutionoftransactionsinfinancialinstrument, clientsoftheinvestmentmediatorshallsubmitorderswiththefollowingminimaldetails:
1. names (title) anduniqueclientnumberoftheclientanditsrepresentative, andifsuchnumbershavenotbeenacquired - respective identification details;
2. type, emitter, uniqueemissioncodeornameoftheinstrument, respectively, detailsofthederivativefinancialinstrumentandnumberofthefinancialinstruments, towhichtheorderrefers;
3. type of order;
4. purposeof the order (buys, sells etc.);
5. single price and total value of the order;
6. validity of the order;
7. place of execution, where the order shall be executed, if the client determines such;
8. quantitative execution of the order (fully, partially);
9. terms of payment;
10. data, time and place of submission of the order;
11. other specific instructions of the client.
(2) Theordershallalsocontainitsuniquenumber.
(3) The submission of the orders under par. 1 through an attorney-at-power shall be done only if the latter submits a notarized power of attorney, which contains authorization to dispose of the financial instruments under Art. 4, par.1 above before the submission of the order. Art. 2, par. 5 herein shall apply respectively.
(4) The investmentmediatormay accept client orders for transactions in financial instruments submitted by telephone or other distance means of communication according to the procedures stated in the Rules of internal organization and control and Policy of order execution to the best interest of the client. In this case, until the end of the business day, the investmentmediator shall issue a document containing the data under par. 1 and data, which are subject matter of the statements under art. 11. par. 5 below, by which it confirms the contents of the distance order.
(5) Par. 4 shall not apply to an order, which has been submitted by a representative, who has not confirmed his authorization to the investmentmediator, or by an attorney-at-power, who has not complied with the provisions under Art.2, par.5 and Art.4, par.1 above.
(6) Par. 4 shall not apply to the transfer of invisible financial instruments from a personal account under a client sub-accountto the investmentmediatorat Central Depositary.
(7) The investmentmediatormay accept client orders under par. 1 through electronic trading system, which guarantees compliance with the requirements of this provision and gives the client an access to a certain place of execution. The access to the system under the previous sentence and the entry of the order by the client shall be done through an electronic certificate issued in its name.
(8) Upon the acceptance of the order, the person, who accepts it, shall check the identification of the client, respectively, its representative.
(9) The investmentmediatorshall submit to the client a signed copy of the accepted order under par. 1, unless it has been submitted according to par. 4 or par. 7.
(10) The investmentmediator shall refuse to accept an order, which does not comply with the provisions of par. 1, or which has been submitted by an attorney without complying with par. 3.
Art.8. (1) The investmentmediatorshall provide the client or the potential client with a general description of the financial instruments and related risks, which has a contents according to Attachment No. 2 herein.
Art.9. In reliance with the provision of investment or additional services to a client, the investmentmediatorshall have the right to pay, respectively, submits and receives, remuneration, commission or non-monetary profit, except for:
1. remuneration, commission or non-monetary profit, paid or submitted from or to the client or its representative;
2. remuneration, commission or non-monetary profit, paid or submitted from or to a third party or its representative, if the following conditions are present:
а) the existence, nature and amount of the remuneration, commission or non-monetary profitare stated by the client clearly, precisely and understandably, before rendering the respective investment or additional service, and when the amount cannot be calculated, the way of calculation is stated. The client may also request detailed information according to the previous sentence;