INFORMATION ON MIFID

According to the new legal regulations, investment service providers and, consequently, our bank, have to categorise clients. The basis for the categorisation is the client’s knowledge of investment products and their operation and risks, with the objective being that client categories so defined receive protection corresponding to their level of expertise.

The MiFID Act differentiates three client categories:

• Retail clients
  
• Eligible counterparties
  
• Professional clients

Institutional investors and businesses meeting certain requirements of size shall qualify as eligible counterparties and professional clients. A retail client meeting the criteria stipulated in the Act may apply to be re-designated as a professional client. All others will be categorised as a retail client if they do not belong to the eligible counterparty or the professional client category (hereinafter: MiFID retail client).

The Bank’s Client Categorisation Policy shall contain details on client categories and the rules of switching categories.

The most stringent rules relating to providing information to clients concern MiFID retail clients, who constitute the majority of all clients; as a result they receive the greatest protection.

The Bank is obliged to inform all of its clients of the client category that has been applied to them and the rights attached to it. In the case of new clients, the information sheet must be handed over upon concluding the contract.

When providing investment advice, the bank has to assess the client’s:

• knowledge of and experience with financial instruments,
• willingness to take risks,
• financial situation and
• investment goals.

Prior to the execution of the orders specified in the Act, the bank has to obtain information on its client’s knowledge of and experience with the essence and features of the particular transaction contained in the contract or the order, as well as the risks attached to such transactions. Based on this, clients will have the opportunity to conclude transactions for particular products in the future.

Accordingly, prior to concluding the contract for the investment transaction, you will have to make a statement on the so-called “Investment Data Sheet” regarding the following:

• your knowledge of and experience with the product, and
• if you wish to use customised investment consultancy services on your willingness to take risks, investment objectives and financial situation.

If you still decide not to provide or only partially provide the above information and you make a written statement to this effect, your order, of course, will be executed. In such cases, we cannot render investment consultancy services.

In the interest of protecting investors, the provision of appropriate information is of key importance. We therefore make a so-called "Investment information booklet" available prior to the submission of your investment order, in which we give assistance in the definition of financial instruments offered by UniCredit Bank, and we also draw your attention to risks inherent in the particular product types.

The MiFID Act requires that investment service providers take every reasonable step to attain the best possible results for clients in the course of the performance of client orders, with respect to the price, costs, speed, the likelihood of execution and performance, the volume and type of orders and other factors relevant to undertaking services.

The procedure for the effective and best execution of orders shall be specified in the implementation policy that contains the places of performance used by the Bank related to all classes of financial instruments, as well as the selection criteria of the place of performance that allows for the attainment of the best results. Naturally, the client is entitled to give specific orders to have their instructions carried out in a way different from that in the Implementation Policy. However, in such cases the client will have to take the risk that their order will not necessarily lead to the attainment of the best possible result.

The General Rules of Business regarding Investment Services contain a brief summary of the Implementation Policy.

Please read the following documents carefully.

• Investment Guide
  
• Investment form for private persons
  
• Investment form for business organizations
  
• Client Classification Policy (shall come into force 1 March 2014)
  
• Execution Policy (shall come into force on 1 June 2016)
  
• General  Business Conditions Pertaining to Investment Services and Ancillary Services (shall come into force on 15 November 2016.)