Conflict of Interest Policy

I. General provisions

Art. 1.    The current Policy for Treatment of Conflict of Interests is an integral part of II “Lenno Global Advisory” JSC’s Internal organization rules and is developed in accordance with the Delegated Regulation (EU) 2017/565 of the Commission from 25 April 2016 supplementing Directive 2014/65/EU of the European Parliament and the Council as regards to the organizational requirements and the activities of operating conditions for the activities of investment intermediaries /Delegated Regulation 565/2017/, The Markets in Financial Instruments Act /MFIA/,Ordinance 58 for the requirements regarding safeguarding the financial instruments and funds of clients,  for the management of products, providing or receiving remuneration, fees or other monetary or non-monetary benefits /Ordinance 58/ and Ordinance 38 for the requirements to the activities of investment intermediaries /Ordinance 38/. 

Art. 2.    The objective of the current Policy for Treatment of Conflict of Interests is to create conditions for preventing and detecting conflicts of interests, and when such conflicts arise – for the fair treatment of clients, disclosure of information and preventing any damage to the clients’ interests. 

Art. 3.    This Policy shall settle:

a)    the treating of conflict of interests in accordance with the size and the organizational structure of II “Lenno Global Advisory” JSC and the nature, the scale and the complexity of the provided investment services and activities;

b)    the circumstances that constitute conflict of interests or which could lead to conflict of interests, arising the risk of damage of client’s interests or the investment intermediary’s clients in relation to any specific service or activity provided by the investment intermediary;

c)    the procedures and measures for treating conflicts of interests;

d)    as the investment intermediary is a member of a group, the Policy also takes into account all circumstances with which the investment intermediary is or should be aware, which may give rise to a conflict of interests as a result of the group's structure and the economic activities of the other members of the group.

Art. 4.    According to Art. 41, parа. 1 from Ordinance 38 “conflict of interests” is a situation which arises in relation to providing investment and/or ancillary services by the II and can harm a client‘s interest.

Art. 5. (1) In providing investment services and activities, the investment intermediary shall take the necessary measures to prevent, identify and manage potential conflicts of interest between:

a)    the investment intermediary, including the persons managing the investment intermediary, the persons working under the contract for it, the related agents or any person directly or indirectly related to the investment intermediary through a relationship of control, on the one hand, and its clients, on the other; 

b)    its individual clients;

c)    different departments or employees of the company.

(2) The investment intermediary shall take the actions under para. 1 and in cases where a conflict of interests may arise as a result of receiving remuneration from the investment intermediary, providing incentives from third parties or other incentive mechanisms.

Art. 6.    (1) If, despite the application of the rules for the internal organization of the Investment intermediary and this Policy, there is still a risk to the interests of the client, II “Lenno Global Advisory” JSC cannot carry out activities on behalf of a client unless he has informed him of the general nature and/or sources of potential conflicts of interests and measures taken to limit the risk to the client's interests.

(2)    In the cases referred to in the preceding paragraph, the investment intermediary, prior to carrying out an activity on behalf of a client in respect of which there is a conflict of interests, provides the client with durable information on the conflict of interests in order to enable him to make an informed decision on the service, in respect of which a conflict of interests arose.

(3)    The disclosure to clients of a conflict of interests under MFIA is an extreme measure used only if the effective organizational and administrative mechanisms established by the investment intermediary for preventing or managing its conflicts of interests in accordance with MFIA are not sufficient to guarantee with reasonable confidence that the risks of damaging the interests of the client will be prevented.

(4)    Upon disclosure there shall be explicitly stated that the organizational and administrative mechanisms established by the investment intermediary for preventing or managing this conflict are not sufficient to guarantee reasonable assurance that the risks of damaging the interests of the client will be prevented.

(5)    The disclosure includes a specific description of the conflicts of interests arising from the provision of investment and/or ancillary services, taking into account the nature of the client to whom disclosure is made.

(6)    The description contains a sufficiently detailed explanation of the general nature and sources of the conflicts of interests as well as the risks to the client arising from the conflicts of interests and the steps taken to limit those risks so that the client can make an informed decision about the investment or the ancillary service in the context of which conflicts of interests arise.

(7)    Excessive reliance on disclosure of the conflict of interests is considered a disadvantage in the policy of the investment intermediary in terms of conflict of interests. Excessive reliance on disclosure of conflict of interest under the preceding paragraph is avoided and shall be considered as a disadvantage of the current policy.

Art. 7.    In order to avoid conflicts of interest, persons working under contract for the investment intermediary shall observe the following principles:

a)    conflict-free - the investment intermediary and the persons working under contract for it should not be placed in a position where their interests will collide with the interests of the client, and if that happens, should always give priority to the interest of client. This Policy accepts the principle that the best management of a conflict of interests is to avoid it completely;

b)    equal and fair treatment and loyalty to the clients - the investment intermediary must always act in the interest of its client. The investment intermediary should not put itself in a position where the interest of one of its client conflicts with its obligation to another of its clients. The II is obliged to apply for the benefit of its client all its professional knowledge and experience, including any publicly available information that it has received and is related to the service provided to the client;

c)    confidentiality - the investment intermediary shall not use confidential information in its favour or for the benefit of a third party, including but not limited to, another client, a member of a management body or an employee of the investment intermediary, or a person working under contract for the II which he received from a client acting on his behalf;

d)    the investment intermediary acts honestly, fairly and professionally in the provision of investment and ancillary services in accordance with the best interests of its clients.

II. Situations of conflicts of interests in the provision of investment services to clients by the investment intermediary

Art. 8.    In identifying the types of conflicts of interest that arise in the course of the provision of investment and ancillary services or a combination of them and the existence of which may harm the interests of the client, the investment intermediary shall consider whether the investment intermediary or the person concerned, directly or indirectly related to the intermediary through control, falls into one of the following situations, whether arising as a result of the provision of investment or ancillary services, or otherwise:

a)    the investment intermediary or that person may make a financial profit or avoid a financial loss at the expense of the client;

b)    the investment intermediary or that person has an interest in the outcome of the service provided to the client or carried out on his behalf deal, which is different from the client's interest in that outcome;

c)    the investment intermediary or that person has a financial or other incentive to favour the interest of another client or group of clients over the interests of the client;

d)    the investment intermediary or that person carries on the same business as the client;

e)    in connection with the provision of investment or ancillary services to a client, shall pay, respectively provide and receive, remuneration, commission or non-monetary benefit, other than remuneration, commission or non-monetary benefit, paid or provided by or to the client or his representative or remuneration, commission or non-monetary benefit, paid or provided by or to a third party or its representative, if the following conditions are met:

•    the payment, respectively provision of the remuneration, commission or non-monetary benefit is for the purpose of improving the quality of service and does not violate the obligation of the investment intermediary to act honestly, professionally and in the best interest of the client;

•    the existence, nature and amount of the remuneration, commission or non-monetary benefit is clearly stated in an accessible, accurate and understandable manner to the client before the investment or ancillary service is provided and when the amount cannot be determined the method of its calculation is indicated;

•    or appropriate fees that provide or are necessary for the provision of investment services such as custodial services, settlement and currency exchange fees, legal fees and public charges and which by their nature do not give rise to a conflict with the obligation of the investment intermediary to act honestly, fairly, professionally and in the best interests of the client.

Art. 9.    The employees of the Internal Control department of II “Lenno Global Advisory” JSC are obliged to monitor the existence of conflicts of interests within the meaning of Art. 4 of this Policy in the course of carrying out their work and in case of such occurrence to notify the Head of Internal Control Department before making any decision. If the Internal Control Department consists solely of a Head the functions of the previous sentence are fulfilled by him accordingly.

Art. 10.    The Head of Internal Control Department monitorс and takeс the appropriate measures for the conflicts which may arise between: 

a)    the interests of individual clients of the company;

b)    the interests of the clients and the interests of the company, including the persons who manage the company, the persons working under the contract for it, the related agents or any person directly or indirectly related to the investment intermediary through control;

c)    the interests of the various departments or employees of the company.

Art. 11.    (1) Upon the provision of investment and ancillary services under Art. 6 paragraph 2, pt. 1, 2, 4, 5 and paragraph 3 of MFIA potential conflicts of interests might arise if the investment intermediary or a person working for it under a contract for the investment intermediary:

a)    has the opportunity to make financial gain or to avoid financial loss at the expense of a client;

b)    has an interest in the outcome of the service provided to the client or in the transaction carried out on behalf of the client, which is different from the client’s interest in that outcome;

c)    has financial or other incentive to prefer the interest of a client or group of clients to the interest of another client;

d)    carries out the same business activity as the client;

e)    receives or will receive benefits in relation to a particular service from a person other than the client;

f)    one person has been involved simultaneously or consecutively in the provision of investment or ancillary services and this harms the client’s interests;

g)    exchanges information which constitutes trade or professional secret between employees of the investment intermediary;

h)    provides information of a trade or professional secret to third parties or to make public appearances without their prior approval by the Internal Control Department;

i)    there is a relation in determining the remuneration of different departments in relation to their work with clients, which may cause harm of the client’s interests; 

j)    concludes transactions with financial instruments in volume or frequency, with prices or a specific counterparty for which given the circumstances can be assumed that are exclusively to the benefit of the investment intermediary;  
k)    concludes personal transactions which are in contradiction with the requirements of the Rules for personal transactions, Delegated Regulation 565/2017, MFIA and Ordinance 38;

l)    advises a client to buy or sale certain financial instruments which another client of his wants to buy or sell;

m)    advises a client to buy or sale financial instruments to a specified by II “Lenno Global Advisory” JSC person in order to influence the exercise of the voting right on the financial instruments;

n)    presence of qualified participation of a person which is working under contract for an investment intermediary in another legal entity with competitive activity to II “Lenno Global Advisory” JSC;

o)    presence of connectivity within the meaning under the MFIA between a person working under a contract for the II and another person, who is a client of the II;

p)    concludes transactions with financial instruments subject to investment research when the person has access to the content and conclusions of the research before it was made public.

(2) This list is not exhaustive as far as in the investment intermediary‘s practice other situations qualifying as conflict of interests may arise and their settlement will be carried out according to the rules of this Policy.

Art. 12.    Transactions with the possibility of conflict of interest, which are treated by II “Lenno Global Advisory” JSC, can be for example:

a)    acquisition of companies and/or shares in companies as well as undertakings or parts of undertakings;

b)    sale of companies or parts of companies as well as undertakings or parts of undertakings;

c)    large orders in relation to companies’ securities, whose securities have been admitted to stock exchange trading;

d)    tender offers for the acquisition and exchange of shares;

e)    transformation and restructuring of companies;

f)    remedial measures and equity financing of companies;

g)    structured financing;

h)    research projects for companies;

i)    investment advice in relation to financial instruments transaction;

j)    transactions on behalf of clients.

Art. 13.    (1) The persons who work under a contract for II “Lenno Global Advisory” JSC, notify the Head of Internal control Department for any personal transaction with financial instruments concluded, with the exception of transactions concluded under individual portfolio management within the terms of Ordinance 38 or for transactions with shares of collective investment undertakings. 

(2) Concluding any personal transaction by a person under para. 1 is prohibited when the transaction meets any of the following conditions: 

a)    concluding the deal is prohibited by MFIA or Law for the implementation of measures against market abuse of financial instruments;

b)    the transaction involves misuse or improper disclosure of confidential information;

c)    the completion of the transaction is in contradiction or can lead to contradiction with II “Lenno Global Advisory” JSC’s responsibilities under MFIA and its applicable acts. 

(3)    The notification under para. 1 shall not be made in the cases when the transactions are concluded through II “Lenno Global Advisory” JSC in compliance with the requirements of art. 29 from the Delegated Regulation 565/2017 for keeping a record of personal transaction executed by relevant persons as defined in art. 2, para. 1 from the Delegated Regulation 565/2017.   
(4)    II “Lenno Global Advisory” JSC keeps record of personal transactions for which it has been informed or which have been discovered by it, including the authorizations and prohibitions in relation to such transactions. 

(5)    In addition to the prohibition under para. 2 shall also be prohibited the acts of providing advice, influencing and disclosing information to third parties under the conditions of art. 29, para. 3 and 4 of Delegated Regulation 565/2017.

Art. 14.    The Head of Internal control Department comply with the following principles for managing conflicts of interests: 

a)    the client’s interest is with priority to that of the investment intermediary or to that of a person, directly or indirectly linked to it by control;

b)    equal treatment of the interests of different clients and preventing unequal treatment of the interest of one client to another in the case that conflict of interests arises;

c)    the investment intermediary should not use confidential information received by acting on behalf of its client, in its advantage or in the advantage of another person including another client; 

d)    disclosing of information regarding potential or certain conflicts of interests to the client if by doing so the existing confidentiality obligation won’t be affected or another client’s interests damaged; 

e)    the investment intermediary is required to put at the service of its client all of its knowledge and experience, including all publicly available information that is relevant to the service provided to the client.

III. Methods of avoiding conflicts of interests and methods of managing conflicts of interests

Art. 15.    The means by which the arising of conflict of interests is avoided or when such conflict has occurred, the means by which a fair and equal treatment of all clients is ensured, are:

a)    full, pre-disclosure of information regarding potential conflict of interests from persons, working under contract for “Lenno Global Advisory” JSC, if by doing so the existing confidentiality obligation won’t be affected or the interests of another client damaged. If despite the implementation of the rules of the II for treating conflicts of interests, there is still a risk to the client's interests, the investment intermediary may not conduct business at the client's expense unless it has informed the client about the general nature and/or sources of potential conflicts of interests and measures taken to limit the risk to the client's interests. For this purpose, the investment intermediary provides sufficiently detailed information on durable medium on each individual client to enable him to make an informed decision on the service in respect of which the conflict of interests arose;

b)    refusal of action in the event of a conflict of interest, in cases where the principles guaranteeing the avoidance of conflict cannot be observed, unless the client has given his explicit consent for the conclusion of the transaction;

c)    observance of the “need-to-know” principle - exchange of information (about clients' financial capabilities, portfolio structure, intentions for investing, prepared but non-circulated recommendations or investment advice, etc.) between different departments of the II, which exchange may give rise to a conflict of interest and this information may harm the interests of one or more clients, is carried out after consultation with the Legal Services Department or Internal Control Department and the members of the Board of Directors of the II, in compliance with the “need-to-know” principle;

d)    lack of direct relation between the remuneration of individuals performing one type of activity and the remuneration of individuals performing another type of activity for II “Lenno Global Advisory” JSC, or the revenues generated by the latter, if a conflict of interest arise in connection with these activities;

e)    fair determination of the remuneration and all additional payments to the persons working under contract for the II in a way that doesn’t create prerequisites for improper execution of the functions assigned to these persons; 

f)    separate supervision of the relevant persons whose principal functions involve carrying out activities on behalf of clients or with providing services to clients whose interests may be in conflict, or who otherwise represent different interests that may conflict, including those of the investment intermediary;

g)    prohibition of the simultaneous or sequential involvement of a relevant person in separate investment or ancillary services or activities where such involvement may impair the proper management of conflicts of interests;

h)    prohibiting any person from exercising inappropriate influence over the way in which a relevant person carries out investment or ancillary services or activities.

Art. 16.    Managing conflicts of interest in II “Lenno Global Advisory” JSC shall be carried out by the following methods:

a)    disclosure of relevant information from the persons under Art. 2, paragraph 1 of the Delegated Regulation 565/2017:

•    ownership of financial instruments, including directly as well as through related parties;

•    related parties with relevant parties under the MFIA;

•    qualifying holdings in other participants in the capital markets, issuers, etc.;

•    performing the same activity as the client of the intermediary;

•    receiving of remuneration, commission or non-monetary benefit from third party if a certain investment or ancillary service is provided to the client;

•    the presence of credit relations with individuals or entities, clients of the intermediary or connected to the intermediary’s clients;

•    holding corporate positions – memberships in management and supervisory bodies of companies, heads of departments or units as well as any other positions, which involve taking management decisions;

•    other circumstances required by applicable law or determined by order of the Board of Directors of II “Lenno Global Advisory” JSC.

b)    developing effective internal organization to prevent abuses with information constituting professional secret inside the investment intermediary;

c)    refraining from action - when for a relevant person within the meaning of art. 2 para. 1 of Delegated Regulation 565/2017, a situation qualifying as a conflict of interest under Delegated Regulation 565/2017, the MFIA and this Policy arises, when providing an investment or ancillary service, it is obliged not to participate in the decision making or in actions related to providing the relevant service; 

d)    third party evaluation – when for the relevant person under art. 2, paragraph 1 from the Delegated Regulation 565/2017 arises a controversial situation, which could be classified as a conflict of interests under Delegated Regulation 565/2017, MFIA and this Policy, when providing a relevant investment or ancillary service, then the executive management of the investment intermediary has the right to require third party evaluation to assess independently whether a conflict of interests exists or not as well as the extent to which the interests of a particular client are affected. The evaluation is formulated in a protocol with the relevant conclusion, which is provided to the management.

Art. 17.    In order to create conditions for avoiding and identifying conflicts of interests, upon taking up their duties II “Lenno Global Advisory” JSC’s employees fill declarations when starting work, which have to include at least the following:

a)    declaration that the employee is familiar with the current Rules and is required to comply with its provisions;

b)    declaration that when concluding transactions or working on transactions with potential conflict, a strict confidentiality expressed in the form of refraining from discussing the information made available to the employee with other employees or external person except with his supervisor, will be kept;

c)    declaration that upon identifying a conflict of interests, the employee is obligated to inform the Head of the Internal control Department immediately, while keeping confidentiality and not discussing this information without explicit permission from the Head of the Internal control Department or the company representatives;

d)    declaration that when contacting the client the employee is required to inform him for potential conflicts of interest for transactions with conflict potential.

Art. 18.    “Front office” employees are required to inform their clients that:

a)    when the investment intermediary is acting on the client’s behalf, an order submitted by a client can be matched by a counter offer from another client from which the investment intermediary will receive a commission;

b)    it is possible for a situation described in art. 11 above to arise.

Art. 19.    During its regular inspections the Internal control Department analyses the situations in which conflicts of interests have arisen. The Head of the Internal control Department promptly notifies the company representatives for any conflicts of interests, the measures taken and the possible ways for their resolving. 

a)    The Internal control Department monitors for preventing, respectively controls the exchange of information between the persons performing activities including conflicts of interest when the exchange of this information could harm the interest of one or more of the clients of the II.

b)    The Internal control Department exercises control over the simultaneous or sequential involvement of one person working under a contract for the II in the performance of separate investment or ancillary services or activities, when such involvement can harm the proper management of conflicts of interests. 

Art. 20.    If the staff of the Internal control Department can’t resolve the conflicts of interests which have arisen, they immediately inform the company’s management.

Art. 21.    In specific conflicts of interest, the Head of Internal control Department together with the company representative’s advice in relation to the conflict resolution and approve specific courses of action. 

a)    The final decision for the respective situation, which could lead to a conflict of interest is taken by the Board of directors of the II; 

b)    The Board of directors, on the basis of the provided documents, adopts a decision approving the transaction or reasonably forbidding it;

c)    The decision of the Board of directors under the preceding sentence is adopted unanimously by the voting members. 

d)    When reviewing a personal transaction of a member of the Board of directors or related person, the member is does not participate in the review and vote on the decision.

e)    The Minutes for the meeting of the Board shall be drawn up, where the reviewed factors and the weight given to each of these factors when taking the decision shall be included. The minutes are signed from all participating members of the Board of directors, taking part in the voting and the documents on the grounds of which the resolution of the Board of directors is adopted shall be attached thereto.

f)    The Board of directors shall inform the person concerned of the decision taken by the end of the working day following the day of the meeting.

IV. Management of conflicts of interests in preparation of investment research

Art. 22.    In the cases when II “Lenno Global Advisory” JSC produces or arranges the production of investment research that is intended or likely to be subsequently distributed publicly or to clients of the investment intermediary, under the responsibility of the investment intermediaries or a member of their group, shall ensure the implementation of all measures set out in art. 34, paragraph 3 from the Delegated Regulation 565/2017 in relation to the financial analysts involved in the production of investment research and other relevant persons to whom the investment research and other relevant persons whose responsibilities or business interests may conflict with the interests of the persons to whom the investment research is provided.

Art. 23.    In the cases under art. 22 II “Lenno Global Advisory” JSC also ensures that the following additional conditions are met:  

a)    financial analysts and other relevant persons do not enter into personal transactions and do not trade in any capacity other than as market makers acting in good faith and in the ordinary course of business, or in the execution of a client's order, on his or her own initiative, on behalf of any other person, including the investment intermediary, with financial instruments related to the investment research or related financial instruments based on information about the likely period or content of this investment research, which is not accessible to the public or clients and which cannot be easily derived from the public or clients available such information until the addressees of the investment research have a reasonable opportunity to act thereon; 

b)    in the circumstances not covered by point (а), financial analysts and any other relevant persons involved in the production of investment research do not undertake personal transactions in financial instruments to which the investment research relates, or any related financial instruments, contrary to current recommendations, except in exceptional circumstances and with prior approval from an employee of the investment intermediary’s  Internal control Department;

c)    II “Lenno Global Advisory” JSC, financial analysts, and other relevant persons involved in the production of investment research, do not accept inducements from those with a material interest in the subject-matter of the investment research;

d)    II “Lenno Global Advisory” JSC, the financial analyst, and other relevant persons who work under contract for the investment intermediary and participate in the preparation of the investment research do not promise to the issuers to whom it relates, their favourable presentation in the research; 

e)    Before the distribution of investment research, relevant persons other than financial analysts, and any other persons are not permitted to review a draft of the investment research for the purpose of verifying the accuracy of factual statements made in that research, or any purpose other than verifying the accuracy of factual statements made in that research, or for any purpose other than verifying compliance with the firm’s legal obligations, where the draft includes a recommendation or a target price. 

Art. 24.    Related financial instrument under art. 23 is a financial instrument whose price is closely affected by the price movements in another financial instrument which is the subject of investment research, and includes a derivative on that other financial instrument. 

Art. 25.    The requirements under art. 23 – 24 are not applied for the investment intermediary who publicly or to clients distributes investment research produced by another person, if the following criteria are met:

a)    The investment research is produced from a person that is not a member of the group to which the investment intermediary belongs;

b)    The investment intermediary does not substantially alter the recommendations within the investment research; 

c)    The investment intermediary does not present the investment research as having been produced by it; 

d)    The investment intermediary verifies that the producer of the research is subject to requirements equivalent to the requirements under Delegated Regulation 565/2017 in relation to the production of that research, or has established a policy setting such requirements.

Art. 26.    Investment research for the purposes under art. 23 – 25 is a research or other information recommending or suggesting an investment strategy, explicitly or implicitly concerning one of several financial instruments or the issuers of financial instruments, including any opinion to the present or future value or price of such instruments, intended for distribution channels or for the public, and in relation to which the following conditions are met:  

a)    the research or information is labelled or described as investment research or in similar terms, or is otherwise presented as an objective or independent explanation of the matters contained in the recommendation;

b)    if the recommendation was made by the client's investment intermediary, it would not constitute the provision of investment advice for the purposes of MFIA.

Art. 27.    A recommendation under art. 3 paragraph 1, pt. 35 of Regulation (EU) 596/2014 that does not meet the conditions set out in art. 26 is considered as a marketing communication for the purposes of MFIA and the investment intermediary that produces and disseminates that recommendation should ensure that it is clearly defined as such, as well as it should ensure that any such recommendation contains a clear and prominent statement that (or, in case of an oral recommendation, to the effect that) it has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that is not subject to any prohibition on dealing ahead of dissemination of investment research.  

Art. 28.    The II discloses information about the organizational and administrative measures taken for preventing and avoiding conflicts of interest in relation to the provided by the II recommendations. Any recommendation must contain information under the first sentence, as for the recommendations that are not written and for which the information required in relation to the names and position of the natural person, producer of the recommendation and the name of the legal person, responsible for the production, and in the case that the producer of the recommendation is an investment intermediary or a credit institution, and regarding the regulatory and monetary authority that supervises such person, is disproportionate in relation to the length of the recommendation distributed, it shall suffice to make clear and prominent reference in the recommendation itself to the place where such disclosure can be directly and easily accessed by the public such as an appropriate internet site of the person, which produced and distributes the recommendation.

Art. 29.    The II stores and updates information about the types of investment and ancillary services provided by the investment intermediary which lead to or upon their provision may lead to conflict of interests which substantially harms the interest of a client or clients of the investment intermediary.  

Art. 30.    Pursuant to art. 72, paragraph 1 from Delegated Regulation 565/2017 the II stores all the documentation relating to its activities in a medium that allows the storage of information in a way accessible for future reference by the competent authority, and in such form that the following conditions are met: 

а)    the competent authority is able to access them easily and to reconstitute each key stage of the processing of each transaction; 

b)    it is possible for any corrections or other amendments, and the contents of the records prior to such corrections or amendments, to be easily ascertained;

c)    it is not possible for the records otherwise to be manipulated or altered;

d)    it allows information technologies or any other efficient exploitation when the analysis of the data cannot be easily carried out due to the volume and the nature of the data; and 

e)    the investment intermediary’s rules comply with the record keeping requirements irrespective of the technology used. 

Additional provisions    

§ 1. „Relevant person“ in relation to the investment intermediary means any of the following persons: 

a)    director, partner or equal to a partner, manager or a tight agent of the intermediary; 

b)    director, partner or equal to a partner or a manager of a tight agent of the intermediary; 

c)    employee of the intermediary or of a tight agent of the intermediary as well as every natural person whose services were made available and under the control of the intermediary or of a tight agent of the intermediary, and which participates in the provision of investment services and activities from the intermediary;

d)    natural person, which participates directly in the provision of services of the investment intermediary or of his tight agent by virtue of outsourcing agreement for the purposes of providing investment services and activities from the investment intermediary; 

§ 2. "A person with whom the relevant person has a family relation" means:

a)    spouse of person under item 5 or a partner of such person, defined as equal to spouse under the relevant national legislation;

b)    underage children;

c)    other relatives to a person under art. 5, with whom the person lives in one household no less than one year since the date of the transaction.

§ 3. "Personal transaction" means a transaction with a financial instrument, performed from the relevant person or on behalf of the relevant person, when one of the following conditions is met: 

a)    the relevant person is not acting in his official capacity;

b)    the transaction is performed on behalf of one of the following persons:

•    the relevant person;

•    any person with whom the person under previous point has a family relation or with whom it has close links;

•    a person whose relationship with a person under the letter “aa” is such that the person under the letter “aa” has a direct or indirect material interest in the outcome of the transaction other than receiving a fee or commission for the transaction.

§ 4. "Financial analyst" means the relevant person, who produces the substance of investment research. 

§ 5. "Durable medium" is a means for providing information to a client, that the client to keep the information addressed directly to him in a way that allows for subsequent acquaintance with it for a period of time that is adequate for the purpose of providing information and allowing reproduction of the information stored without changes.

§ 6. "Recommendation" ("investment recommendation") means information that recommends or proposes an investment strategy, either explicitly or by default, with respect to one or more financial instruments or issuers, including any opinion on the current or future value or price of such instruments, intended for distribution channels or the public.

This policy is adopted with a decision of the Board of Directors of II “Lenno Global Advisory” JSC from 27.12.2019 and is entered into force on the day of its adoption. The Policy supersedes all previous provisions of the Policy for treatment of conflict of interests of II “Lenno Global Advisory” JSC.

Last updated: March 10, 2020
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