Order Execution Policy

I. General provisions

Art.1.    This Policy is developed pursuant to the Markets in Financial Instruments Act (MFIA) and Commission Delegated Regulation (EU) 2017/565 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organizational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive (Delegated Regulation 2017/565) and Ordinance No 38 on the Requirements for the activity of investment firms (Ordinance No 38).

Art. 2.    The purpose of this Policy is to ensure a high quality of execution of the transactions carried out for the account of Lenno Global Advisory’ s clients and to maintain the integrity and efficiency of the financial system when the investment intermediary:

a)    executes orders on behalf of clients; 

b)    receives and transmits orders in relation to one or more financial instruments, including intermediating for conclusion of transactions in relation to financial instruments; 

c)    gives orders to execute transactions on behalf of clients in relation to a customer’s portfolio managed by the investment firm. 

II. General provisions and principles in the execution of clients’ orders 

Art. 3.    (1) II “Lenno Global Advisory” executes their clients’ orders in their best interest according to the Policy adopted by the investment intermediary, taking into account the price, costs, speed of execution and settlement, size, nature, as well as all other circumstances related to the execution of the order. 

(2) When providing investment services and activities on behalf of clients II “Lenno Global Advisory” JSC acts honestly, fairly and professionally in accordance with the best interests of its clients.

(3) II “Lenno Global Advisory” JSC treats its clients equally.

(4) In compliance with the obligation of achieving best result for the client an II “Lenno Global Advisory” JSC shall execute its clients’ orders as it earliest convenience, unless this would obviously be to the clients’ disadvantage.

(5) The Investment intermediary shall make all reasonable efforts to establish the best price for the client pursuant the order’s parameters, amount of costs, probability of execution, as well as the other circumstances related to the execution of the order. 

(6) The Investment intermediary may not execute orders on behalf of its clients if it has not obtained their prior consent to the Policy. 

(7) In case of specific clients’ instructions II “Lenno Global Advisory” executes the order in accordance with these instructions, in regards to the factors determining the best execution in client’s interest, and for those orders for which there are no instructions, the investment intermediary makes an appropriate assessment. 

(8) Any specific clients’ instructions may prevent the intermediary from taking all necessary actions to achieve the best result when executing clients’ orders in accordance with this Policy, for that part of the order, which the specific instructions refer. 

III. Factors which the investment intermediary reviews and assess when executing clients’ orders

Art. 4.    (1) II “Lenno Global Advisory” JSC executes the client orders in his best interest, as to fulfill this obligation the company makes reasonable efforts to determine:

a)    The best price for the client according to the parameters of the order: The price of the financial instruments is an important factor, which the investment intermediary reviews when executing clients’ orders. This factor considered together with the costs related to the execution of client’s order shall be regarded as the most important factor in respect of the retail clients, as well as the selection of execution venue. 

b)    Amount of the cost: The cost related to the execution of clients’ orders is the second most important factor, which the investment intermediary reviews together with the price of the financial instruments. The expenses related to the performance shall include all expenses that are directly related to the execution of the order, including fees for the execution venue, clearing and settlement fees, as well as other fees and remunerations payable to third parties, bound with the execution of the order. The costs are also crucial for the selection of an execution venue. 

c)    Volume/number of the financial instruments. The volume or the number of the financial instruments of the client’s order are directly related to the price of the financial instruments. and the transaction costs. Depending on the order volume different execution venues may be selected. 

d)    Speed of execution: The price of the financial instruments depends on the speed of execution. The Investment intermediary takes this factor into account when selecting the execution venues.

e)    Probability of execution: In every particular case the Investment intermediary assesses the execution probability and select the execution venue on that basis. 

f)    Type and nature of the order: The Investment intermediary assesses what the best result for the client might be and assesses all the factors listed according to the type and nature of the order: buy, sell, exchange, etc.; limited, market, etc. 

g)    Any other factors that are relevant to the order execution and the achievement of the best result. 

(2) In execution of client orders II “Lenno Global Advisory” JSC shall take into account the relevant significance of the factors under para. 1, according the following criteria:

a)    the characteristics of the client, including whether he has been defined as a retail or professional client;

b)    the characteristics of the client’s order, including when the order relates to a securities financing transaction;

c)    the characteristics of the financial instruments subject of the order;

d)    the characteristics of the execution venues, to which the order may be directed for execution.

Art. 5.    Additional criteria applicable to retail clients’ orders.

(1) When executing an order given by a retail client, the best possible performance of such order shall be determined by the total amount of the transaction, including the price of the financial instrument and the expenses related to the performance. The expenses related to the performance shall include all expenses that are directly related to the execution of the order, including fees for the execution venue, clearing and settlement fees, as well as other fees and remunerations payable to third parties, bound with the execution of the order.

(2) To achieve best possible performance, in the cases where there is more than one competitive execution venues of an order in relation to financial instruments and in making assessment and comparison of the results that may be achieved for a retail client where executing the order on each of 

Art. 4.    (1) II “Lenno Global Advisory” JSC executes the client orders in his best interest, as to fulfill this obligation the company makes reasonable efforts to determine:

a)    The best price for the client according to the parameters of the order: The price of the financial instruments is an important factor, which the investment intermediary reviews when executing clients’ orders. This factor considered together with the costs related to the execution of client’s order shall be regarded as the most important factor in respect of the retail clients, as well as the selection of execution venue. 

b)    Amount of the cost: The cost related to the execution of clients’ orders is the second most important factor, which the investment intermediary reviews together with the price of the financial instruments. The expenses related to the performance shall include all expenses that are directly related to the execution of the order, including fees for the execution venue, clearing and settlement fees, as well as other fees and remunerations payable to third parties, bound with the execution of the order. The costs are also crucial for the selection of an execution venue. 

c)    Volume/number of the financial instruments. The volume or the number of the financial instruments of the client’s order are directly related to the price of the financial instruments. and the transaction costs. Depending on the order volume different execution venues may be selected. 

d)    Speed of execution: The price of the financial instruments depends on the speed of execution. The Investment intermediary takes this factor into account when selecting the execution venues.

e)    Probability of execution: In every particular case the Investment intermediary assesses the execution probability and select the execution venue on that basis. 

f)    Type and nature of the order: The Investment intermediary assesses what the best result for the client might be and assesses all the factors listed according to the type and nature of the order: buy, sell, exchange, etc.; limited, market, etc. 

g)    Any other factors that are relevant to the order execution and the achievement of the best result. 

(2) In execution of client orders II “Lenno Global Advisory” JSC shall take into account the relevant significance of the factors under para. 1, according the following criteria:

a)    the characteristics of the client, including whether he has been defined as a retail or professional client;

b)    the characteristics of the client’s order, including when the order relates to a securities financing transaction;

c)    the characteristics of the financial instruments subject of the order;

d)    the characteristics of the execution venues, to which the order may be directed for execution.

Art. 5.    Additional criteria applicable to retail clients’ orders.

(1) When executing an order given by a retail client, the best possible performance of such order shall be determined by the total amount of the transaction, including the price of the financial instrument and the expenses related to the performance. The expenses related to the performance shall include all expenses that are directly related to the execution of the order, including fees for the execution venue, clearing and settlement fees, as well as other fees and remunerations payable to third parties, bound with the execution of the order.

(2) To achieve best possible performance, in the cases where there is more than one competitive execution venues of an order in relation to financial instruments and in making assessment and comparison of the results that may be achieved for a retail client where executing the order on each of the execution venues, specified under the intermediary’s policy for performance of orders which are suitable for its execution, the intermediary’s commission fees and the expenses incurred in connection with the execution of the order on each of the possible venues shall be taken into consideration.

IV. Execution venues 

Art. 6.    IA “Lenno Global Advisory” may execute its clients’ orders at the following venues:

a)    Regulated securities market - Bulgarian Stock Exchange-Sofia –, which through a unified trading system, concentrates the demand and supply of financial instruments meeting minimum requirements, and also assists for - the conclusion of transactions with these financial instruments at market prices; swiftness, information disclosure, efficiency, large number of traded stocks, liquidity, centralized dissemination of market information;

b)    Outside a regulated market -  clients’ orders may be executed outside a regulated market if the intermediary’s clients have been informed in advance and have given their express consent;

c)    Multilateral trading system;

d)    Organized trading system;

e)    Liquidity Providers-  secure the ability to quickly complete buy and sell orders and have the following benefits - swiftness, information disclosure, efficiency, various underlying assets, high liquidity, risk management, margin management, availability of trading platforms for access. Lenno Global Advisory JSC maintains contracts with liquidity providers in accordance with a decision of the governing body of the company in order to ensure the best execution of client orders. Detailed information on specific venues is available on an annual basis in accordance with Article 3 (1) and (2) of Regulation (EU) 2017/576

(2) II “Lenno Global Advisory” JSC shall not structure or charge its commissions in a way that discriminates incorrectly between the execution venues.

(3) The advantage of “BSE” JSC as a place for execution is related to its physical location on the territory of the Republic of Bulgaria, which implies high efficiency in the work of the intermediary in executing client orders. Better commission policy should be taken into account at this place of performance compared to foreign ones. Due to the fact that the shares of Bulgarian companies are traded on “BSE” JSC, this enables the execution of client orders in the volume specified by the client, and the price of these shares is formed on the same market where they will be bought or sold. Last but not least, compensation instruments are traded only on „BSE“ JSC as a venue for performance.:

(4) The execution venues list under para. 1 is not an exhaustive list. The Investment intermediary may also use other execution venues, that it deems to be appropriate according to this Policy. The Investment intermediary shall assess and analyze on a regular basis the possible new execution venues and shall update para. 1 above. In this connection the client shall be notified about the amendments made to the list.

(5) In regards to specific financial instruments, it is possible that in essence the order could be executed at only one venue. When executing clients' orders in such circumstances it is considered that the investment intermediary has achieved the best result for the client.

V. Submission and execution of clients’ orders

Art. 7.    (1) The Investment intermediary accepts orders for transactions with financial instruments, submitted personally by the client or by his proxy, and in the cases of clients – legal entities – by his authorized representative. Except in cases of portfolio management the investment intermediary engages in transactions with financial instruments on behalf of clients only on the basis of clients’ orders with the following minimum content: 

a)    the names (business name) and the unique client number of the client and of his representative, and if such numbers have not been assigned – the respective identification data. Where an investment intermediary assigns to its clients a unique number, it shall keep for them a register which will contain at least that number and the following data: the full name, Personal Identification Number, domicile and address, or business name, identification number BULSTAT, tax number, seat and address of the client, and if the client is a foreign person – analogous identification data. In the register according the previous sentence shall be also entered the relevant identification numbers for his representative or proxy, number and date of the power of attorney, and the investment intermediary may assign a unique number also to the representative or the proxy; 

b)    type, issuer, ISIN code of the issue, or name of the instrument, respectively characteristics of the derivative financial instrument and number of financial instruments to which the order relates; 

c)    type of the order;

d)    nature of the order (acquisition or disposal of a financial instrument);

e)    unit price and total amount of the order;

f)    the order’s term of validity;

g)    execution venue if the client has determined such;

h)    quantitative execution of the order (in part, in whole);

i)    way of payment;

j)    date, hour and place of giving the order;

k)    other specific instructions by the client;

l)    indication of whether the order was given as a result of investment advice;

m)    way of giving the order.

(2) Paragraph 1 is not applicable when the order is submitted via an electronic trading platform, where the order details are not determined by the investment intermediary.

(3) The unique serial number is detailed in the order. 

(4) When submitting an order, the client is informed of:

a)    the current Policy;

b)    the financial instruments and the risks associated with them;

c)    the execution venues, on which the investment intermediary relies substantially when fulfilling its obligation to take all reasonable steps to consistently achieve the best possible results when performing clients’ orders and to indicate the execution venues, used for each class of financial instruments;

d)    the costs and fees of the transaction;

e)    where the clients’ assets (financial instruments and cash) can be stored, by whom they can be stored and what is the responsibility of that person;

(5) The giving of the orders by a proxy shall be done only if the proxy submits notarially attested power of attorney, which contains representative authority for execution of actions of disposal with financial instruments and a declaration by the proxy that he does not carry out by occupation transactions with financial instruments, as well as that he did not execute such for a one-year period prior to conclusion of the contract. A copy of the client’s identification document or his representative, certified by the client and by the person who concludes the contract for the investment intermediary shall remain in the investment intermediary’s records. The certification shall be performed with the affixing of inscription “true to the original”, date and signature of the person, making the certification. Upon submitting the orders under paragraph 1 in entered in the register under article 30, par 1. item 2 from FSCA head office, branch or office of the investment intermediary, if in the process of verification of the client's identity any change in the personal details has been established, or if a new identity document has been issued, article 24, paragraph 5 from Ordinance 38 shall apply.

(6) In case of placing orders for transactions over the telephone, the investment intermediary is obliged to make a record of the conversation with the client, which attests the content of the given order pursuant para. 1. In case of placing orders for transactions by another remote means of communication, the investment intermediary is obliged to electronically store the information, provided by the client in relation to the orders. 

(7) Paragraph 6 shall not apply to an order, given by a representative who has not attested to the investment intermediary his representative authority, or by a proxy who failed to present in advance the documents under Art. 25 from Ordinance 38.

(8) Paragraph 6 shall not apply with regard to transfer of dematerialized financial instruments from e personal account under a client sub-account to the investment intermediary in the Central Depository.

(9) The Investment intermediary may accept client orders under para. 1 through an electronic trading system, which guarantees compliance with the requirements of Ordinance 38 and ensures an access of the client to specific execution venue. The access to the system under the preceding sentence and the entry of orders by the client shall be accomplished by a computer and/or mobile applications, which ensure reliable identification of the clients.

(10) Upon the order acceptance, the person accepting it shall check the identity of the client, or of his representative.

(11) The Investment intermediary shall refuse to accept an order, which does not satisfy the requirements of para. 1 or has been given by a proxy, without the requirements of para. 5 to be complied with.

(12) The Investment intermediary shall provide to the client a signed copy of the accepted order under para. 1, unless it is given according to para. 6 and 9.

Art. 8.    (1) The Investment intermediary may accept orders for transactions with financial instruments as follows:

a)    On-site at the investment intermediary’s office. Upon giving orders on-site at the office of II “Lenno Global Advisory” JSC, the same shall be accepted only at entered in the register under article 30, par 1. item 2 from FSCA management address or office, by employees under article 39 para. 1 and/or para. 2 of Ordinance 38. 

b)    By remote means of communications: by telephone or e-mail. The Investment intermediary may accept orders for transactions with financial instruments over the telephone or by another remote means of communication placed by clients. By signing a contract for the provision of a certain type of investment service, the client gives his consent to the recording of telephone conversations with the personnel of the investment intermediary. The client is informed and agrees that when accepting orders over the telephone an employee of “Brokers” department and/or “Front – office” department shall require the client to provide relevant personal data for correct identification. The client respectively his representative shall send to the II a copy of his identity document, signed in accordance with the previous sentence, and for clients – legal persons - and copy of commercial registration documents containing information on the establishment and representation if in the public register have a change in the data.

c)    The Investment intermediary may accept client orders through an electronic trading system, which guarantees compliance with the requirements of Ordinance 38 and ensures an access of the client to specific execution venue. The access to the system under the preceding sentence and the entry of orders by the client shall be accomplished by a computer and/or mobile applications, which ensure reliable identification of the clients. 

(2) Paragraph 1 shall not apply to an order, given by a representative who has not attested to the investment intermediary his representative authority, or by a proxy who failed to present in advance the documents under Art. 25 of the Ordinance 38 to the investment intermediary. 

(3) Paragraph 1 shall not apply with regard to transfer of dematerialized financial instruments from e personal account under a client sub-account to the investment intermediary in the Central Depository. 

(4) The Investment intermediary shall provide to the client a signed copy of the accepted order under para. 1, unless it is given according to para. 1, item “b.” and “c.” 

Art. 9.    (1) Types of orders, which the client may submit on a regulated market are specified in chapter IV „Trading Rules” of the General Rules of „BSE – Sofia” JSC, as well as in the applicable legislation.

(2) The clients’ orders submitted for performance on “BSE-Sofia” JSC shall be executed in accordance with the applicable legislation, Terms and Conditions in relation to transactions with financial instruments of II “Lenno Global Advisory” JSC, Contract for the provision of Investment and/or ancillary services, Contract for purchase/sale of financial instruments, and this Policy. 

(3) An employee of “Front-office” department accepts the client’s order, the employee hands it over to the employee of “Back-office” department for processing, after that the stock broker uploads the order in the trading system. The client should bear in mind that the procedure from accepting the order to its implementation in the trading system requires a certain technological time.

Art. 10.     (1) Upon order acceptance, the investment intermediary shall require from the client, or from his representative, to declare if: 

a)    he possesses inside information about the financial instruments, to which the order relates, and about their issuer, if the financial instruments to which the order relates or on the basis of which the financial instruments – subject of the order are issued, are traded on a regulated market; 

b)    the financial instruments – subject of sell or exchange order, are blocked at the depository institution, in which they are safeguarded, whether there is a pledge set up on them or distraint levied; 

c)    the transaction – subject of the order, constitutes a concealed purchase or sale of financial instruments. 

Art. 11.    (1) The investment intermediary shall execute the client orders on the following conditions: 

a)    immediate and accurate registration and allocation of the orders for execution; 

b)    immediate execution in the sequence of their receiving of identical client orders, unless the characteristics of the order or the prevailing market conditions make this unrealizable, or the interests of the clients require otherwise; 

c)    the investment intermediary shall inform a retail client about the arisen objective difficulties, obstructing the exact execution of the orders, immediately upon coming to know of them. 

(2) When the investment intermediary is responsible for overseeing or arranging the settlement of the executed order, he takes all reasonable steps to guarantee that all of the client’s financial instruments or funds received upon the settlement of this order, are delivered promptly and correctly to the respective client.

(3) The investment intermediary shall not misuse information relating to pending client orders, and shall take all reasonable steps to prevent the misuse of such information by any of its relevant persons. 

(4) The best execution of the order is achieved when II “Lenno Global Advisory” JSC has made the reasonable and possible efforts to establish the best price for the client according to the order’s details, amount of costs, probability of execution, as well as all the other circumstances related to the execution of the order.

Art. 12.     (1) The Investment intermediary shall refuse client’s order if the client respectively his representative refuses to file the declaration under Art. 9, para. 1 above, it has been declared that he possesses inside information or he declares that the transaction – subject of the order, constitutes a concealed purchase or sale of financial instruments. The refusal under sentenced one shall be certified by a separate document, signed by the client. 

(2) The investment intermediary shall not have the right to execute an order, if it has been declared or if the intermediary establishes that the securities – subject of an order for sale, are not available on the client’s account or have been blocked in a depository institution, as well as if there is a pledge set up on them or distraint levied. 

(3) The prohibition under para. 2 in relation to pledged financial instruments shall not apply if the acquirer has been informed about the set up pledge and has stated express consent to acquire the pledged financial instruments, there is an explicit consent of the pledge creditor in the envisaged cases under the Registered Pledges Act; 

(4) The prohibition under para 2 in relation to an order for the sale of financial instruments which are not available on the client’s account, shall not apply in the cases when the investment intermediary ensures otherwise that the financial instruments, subject of the sale, shall be delivered on the day of the transaction’s settlement, as well as in other cases as laid down in an ordinance.

(5) An investment intermediary shall not have the right to execute a client’s order for transactions with financial instruments, if that would result in violation of the Delegated Regulation 565/2017, the Markets in Financial Instruments Act (MFIA), Law on Measures against Market Abuse with Financial Instruments (LMMAFI), the Act on Special Investment Purpose Companies (ASIPC) or some other acting statutory acts.

Art. 13.    In case of a limit order by a client relating to shares admitted to trading on a regulated market, where it is not executed without delay in accordance with the effective market conditions, the investment intermediary shall take measures unless the client expressly gives another instruction to execute the order as soon as possible by publicly announcing the order of the client under the procedure of Art. 70 of Delegated Regulation 565/2017.

Art. 14.    The obligation under Art. 14 is considered to be fulfilled by II “Lenno Global Advisory” JSC with the transmission of the limit order on a regulated market and/or a multilateral trading facility or when the order is published by a service provider established in a Member-State. 

Art. 15.    II” Global Advisory” JSC may not comply with the obligation under

Art. 14 If the volume of the order does not correspond to the normal market volume.

Art. 16.    II “Lenno Global Advisory” does not transfer its clients’ s orders for execution to other persons.

Art. 17.    II “Lenno Global Advisory” JSC shall not execute orders on behalf of its clients unless they have given their prior consent to this Policy.

Art. 18.    An investment intermediary shall demand from a client, who gives an order for the purchase of financial instruments, to provide to it the cash needed for the payment on the transaction – subject of the order, upon giving the order, except if the client attests that he will fulfill his liability for payment, as well as in other cases as laid down in an ordinance. If the rules of the execution venue on which the transaction will be concluded, allow the execution of a transaction where the payment for the financial instruments is not effected simultaneously with their transfer, the investment intermediary may not demand payment by the buyer, if there is express written consent of the seller for that. This shall apply accordingly also to other transfer transactions with financial instruments.

Art. 19.    The information stored by the investment intermediary about the transactions concluded with financial instruments on behalf of a client contains at least information about the client’s identity and the actions undertaken in implementation of the Law on Measures against Money Laundering and Law on Measures Against the Financing of Terrorism.

Art. 20.    The investment intermediary shall keep the information about the provided services and activities under Art. 6, para. 2 and 3 of the MFIA for at least 5 years.

VI. Aggregate orders policy

Art. 21.    According to this policy, the investment intermediary is not entitled to execute a client's order by aggregate them with other client's orders, unless the following conditions are met:

a)    the aggregate of orders and transactions will not be to the detriment of any of the clients whose orders are aggregated;

b)    the investment intermediary has explained to each client whose order is aggregated that the merger may be unprofitable to the client in relation to the specific order;

c)    the investment intermediary has accepted and effectively applies a split order policy that contains sufficiently detailed and clear conditions for the fair split of the aggregated orders and transactions, including indicating how the volume and price of the orders determine the split and settlement of partial execution cases. The policy referred to in the previous sentence is specified in the next section of this policy;

d)    the client's order allows partial execution;

e)    the aggregated order itself permits partial execution

Art. 22.    (1) II “Lenno Global Advisory” JSC aggregate client orders in the following cases:

a)    in case, there are orders from clients with the same price and at the execution venue, the best counter offer is for a larger quantity and a price that satisfies the orders. Thus, both orders are executed at the same price, but in the processing first is the order accepted earlier;

b)    when customer orders are at different prices and the execution venue, the best counter offer is for a larger quantity and a price that satisfies both orders. Again, both orders are executed at the same price and in the processing first is the order accepted earlier;

(2) In case when the aggregate offer is set up, the counter offer is changed and the aggregated offer is fulfilled in several parts and at different prices, or even partially fulfilled, the earlier order shall be given priority.

VII. Policy for separation and distribution of orders

Art. 23.    (1) In the cases under the preceding Article, where the aggregated order is executed in accordance with this policy, the investment intermediary shall apply rules for the fair separation of the aggregated orders and transactions established in this and subsequent articles.

(2) In cases where the investment intermediary aggregate an order of a client with one or more other client orders and the aggregated order is thus fully executed, it distributes the related transactions - the result of execution of the order according to the following rules:

a)    The result of the transaction - the result of execution of the aggregated order, is allocated only and only among the orders included in the aggregated order;

b)    The aggregate order shall be separated according to the exact volume (number) of financial instruments of the orders placed therein. Thus, in the separation, the clients whose orders were included in the aggregated order, since the aggregated order was fully executed, receive as execution the exact number (volume) of financial instruments, which number (volume) corresponds exactly to the order submit by them;

c)    The transaction resulting from the execution of the aggregate order is executed at a specified price and the price is valid for all transactions included in the aggregated order. Thus, in the distribution, the clients whose orders were included in the aggregated order, since the aggregated order was executed in full compliance with this rule, receive in the distribution as execution the transaction price as a result of the execution of the aggregated order, which price corresponds exactly to the submitted of them ordering, or better. In the cases of the preceding sentence, when a better price is achieved, the benefit belongs to the customer.

Art. 24.    (1) In case the investment intermediary  fails to execute in full, fully consolidated client orders, the investment intermediary distributes the execution (in terms of realized amount of financialinstruments and execution price) among all clients whose orders have been aggregated, hereinafter referred to as 'the distribution'. 

(2) The distribution shall be made in accordance with the general rules set out below. In the distribution, the II may at its discretion adopt one of the two referred to in Art. 26 methods, depending on, but not limited to, any of the following factors:

a)    the market in which the orders are executed;

b)    the existence of a competitive bidding principle;

c)    specific conditions concerning the volume of orders submitted;

d)    the limited amount of the issue;

e)    other factors.

Art. 25.    The investment intermediary uses the following methods for allocating pooled orders:

a)    Proportional Allocation: Each client receives a proportional performance, according to the proportion of his order in the common, combined order. The execution price for all will be the weighted average cost of all transactions (if more than one) performed in the execution of the combined order.

b)    Sequential distribution: Subject to the order of receipt of orders in the investment intermediary and depending on the price specified in the order will be satisfy / execute orders with a better price, and with orders with identical ones prices - according to their sequence of entry into the system of investment intermediary. The execution occurs until the quantity of the aggregate order is exhausted. The last order can be partially satisfied unless it is of the "all or nothing" type. The price of execution is determined according to the transactions (if more than one) of priorities "price" and "time of receipt of the order".

VIII. Review and update of the policy

Art. 26.    (1) II “Lenno Global Advisory” JSC permanently monitors the effectiveness of this Policy and the quality of the execution of the orders and, where necessary, takes corrective measures to the irregularities detected. 

(2) A revision of thе Policy and the agreements for execution of clients’ orders is made once a year. 

(3) A revision under para. 2 shall also be carried out whenever a material change that can affect the  investment intermediary ability to ensure best results for execution of client orders when using the execution venues which are included in the policy for order execution occurs. 

 (4) The Investment intermediary is required to promptly notify its clients of any changes to this Policy. 

IX. Additional provisions

§ 1. Definitions:

1. Throughout this Policy, the definitions used have the meaning set forth against, except in contradiction with the legal definition, in which case the latter will prevail:

a)    "Client" means an individual or legal person to whom an investment intermediary provides investment or ancillary services.

b)    "Professional client" means a client who has the experience, knowledge and skills to take self-investment decisions and properly evaluate the risks associated with investment, and which meets the criteria on the basis of which they qualify the clients of II “Lenno Global Advisory” JSC.

c)    "Non-professional client" means a client who is not designated as a professional client or as an acceptable counterparty.

d)    "Eligible Counterparty" means an investment firm, a credit institution, insurance company, collective investment scheme, management company, pension fund, pension insurance company, other financial institutions, licensed or regulated by European Union law and by Member States, national governments, public debt management bodies, central banks and international institutions, as well as third-country entities to whom requirements equivalent to those of European Union law apply. Eligible counterparties may be considered as other persons who meet the requirements set out in Art. 71 of Delegated Regulation 565/2017 requirements, including persons from third countries.

e)    "Place of performance" means the place where the investment firm executes client orders, such as a regulated market, a multilateral trading system, an organized trading system, a systematic participant, a market maker, another liquidity provider or entities who perform functions similar to those performed by any of the above entities in a third country

§ 2. Exceptions:

1. This policy does not apply in the following cases:

a)    eligible counterparties - if the client is classified by the investment firm as an eligible counterparty, it does not benefit from the best execution protection under this Policy. Any customer identified as an eligible counterparty may explicitly request that it not be considered as such in whole or in particular. When concluding a transaction with or for an eligible counterparty from a third country, the investment firm should have the express confirmation of the entity that it agrees to be treated as an eligible counterparty.

b)    special instructions to the client - where the client provides specific instructions regarding the entire order or any aspect of the order, including the requirement to execute the order at a specific place of execution, the investment firm shall execute the order in accordance with those instructions. It is thus considered that the investment firm has taken all reasonable and necessary steps to achieve the best result for the client with respect to the entire order or aspect of the order contained in the client 's instructions.

2. When placing an order on an electronic trading platform, the client selects all the order parameters and the latter is classified as submitted with special instructions. In this case, the investment intermediary acting on behalf of the client by granting him access to the system shall be deemed to have fulfilled his efforts to achieve the best result for the client. In case the electronic system allows some order parameters not to be specified, the investment intermediary takes care of the best performance in accordance with this Policy.

X. Final provisions

§ 1. When problems are encountered in practice, the solving of which requires an amendment or supplementation to this Policy, the competent authority may change it in due course, being governed by all legal requirements. 

§ 2. Тhe Executive directors of the investment intermediary may issue orders and instructions on the implementation of this Policy. 

§ 3. This Policy shall be submitted to the executive directors of the investment intermediary, the investment advisories under contract by the investment intermediary, the stock brokers and all other investment intermediary’s employees for information purposes upon taking up their duties, and they provide a declaration for statement that they are familiar with them, which declaration is attached to the other documents, related to the performance of their duties in the investment intermediary. 

The information is provided to clients and potential clients and this Policy is published on the Company's website - www.lenno.com.

This Policy is approved by a resolution of the Board of Directors of II “Lenno Global Advisory” JSC dated December 27, 2019, and shall enter into force on the date of its adoption.

This Policy supersedes all prior provisions of the II “Lenno Global Advisory” JSC Policy for execution of clients’ orders.

Last updated: March 10, 2020
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