terms of business for investment services
TRANSCRIPT
Terms of Business for Investment Services
Effective from 11 June 2020
Contents PAGE
SECTION ONE: TERMS OF BUSINESS FOR INVESTMENT SERVICES DEFINITIONS 3
PART 1: GENERAL PROVISIONS AND YOUR RELATIONSHIP WITH CITI 5
1. Introduction 51.1 AmendingtheseTermsofBusiness 51.2 Noticesandcommunications 51.3 Marketinformation,researchorreports 61.4 Cancellationrights 61.5 TerminatingtheseTermsofBusiness 61.6 Nowaiverandseverability 61.7 Monitoringandrecording 71.8 Yourinformationandhowweuseit 71.9 Compensation 71.10 Complaints 71.11 LimitsonliabilityofCitigroupOrganisation 71.12 Fees,expensesandbenefits 71.12.5 Inducements 81.13 Taxes 81.14 Conflictsofinterest 81.15 Non-publicinformation 81.16 CitiOnline 91.17 Notaxadvice 91.18 Governinglaw 91.19 Assignmentandtransfer 9
PART 2: OUR INVESTMENT SERVICES 92.1 General 92.2 AccountRelationshipTypes 92.2.1.1 AdvisedAccountRelationship 92.2.1.2NonAdvisedAccountRelationships 102.3 LinkedAccounts 102.4 Minimumlumpsuminvestmentamounts 102.5 Regularinvestments 10
PART 2A: INVESTMENT ADVISORY SERVICES 2.6 Investmentobjectives 102.7 AdvisedAccountRelationship 102.8 Yourobligationtoprovideinformation 112.9 InvestmentAdvisoryServicesinrelationto
JointInvestmentAccounts 11
PART 2B: NON-ADVISED SERVICES 2.10 Non-AdvisedServices 12
PART 2C: FURTHER TERMS APPLICABLE TO INVESTMENT SERVICES FOR ALL RELATIONSHIP TYPES
2.11 Yourknowledgeandexperience 122.12 JointInvestmentAccounts 122.13 InvestmentAccountstatements 122.14 Clientmoney 122.15 Delegation 122.16 Investmentinformation 122.17 Powerofattorney(agentorproxy-holder) 132.18 ExecutionServices 132.19 Confirmations 132.20 Dealing;selectionofbrokers,agentsandother counterparties 142.21 CustodyArrangements 142.22 Citi’sCustodyServices 142.23 OurrightsoveryourInvestmentProducts 152.24 ThirdpartyCustodians 162.25 PackagedRetailandInsurance-BasedInvestmentProducts16
PART 3: INVESTMENT ISA3.1 Plan 163.2 Subscription 173.3 Transfersin 173.4 CancellationofaPlan 173.5 Investmentchoiceandyourinvestmentobjectives 173.6 InvestinginyourPlan 173.7 Instructions 173.8 IncomefromyourPlan 183.9 AssetsheldwithinyourPlan 183.10 Custodyservices 183.11 Documentation 183.12 Withdrawals 183.13 Transferstootherplanmanagers 183.14 Termination 183.15 Death 193.16 Charges 193.17 RecordsofyourPlan 193.18 Delegationoffunctions 193.19 Exclusionofliability 19
SCHEDULE 1: CONTRACTS ENTERED INTO AT A DISTANCE 1. Distancecontracts 192. InformationaboutCiti 193. InformationaboutCiti’sservices 194. Informationaboutcharges,costsandtaxes 195. InformationabouttheTermsofBusiness 196. Cancellationrights:theseTermsofBusiness 197. Contactdetails 20
SCHEDULE 2: INVESTMENT PRODUCT TERMS 1. CollectiveInvestmentSchemes 202. ISAs 203. Structurednotes 204. InvestmentFundsAccount 20
SCHEDULE 3: CLIENT MONEY1. Clientmoney 212. Unclaimedcustodyassets 21
SCHEDULE 4: UNDERSTANDING OUR SERVICES AND RISKS 1. Shares 222. DepositaryReceipts 223. Bonds 224. CollectiveInvestmentSchemes 235. ExchangeTradedNotes(“ETNs”) 246. ExchangeTradedCommodities(“ETCs”) 247. Derivatives 248. StructuredProducts 259. ForeignExchange 2510. Non-readilyrealisableinvestments 2511. Stabilisation 2612. EmergingMarkets/Countryrisk 26
SCHEDULE 5: SUMMARY OF OUR BEST EXECUTION POLICY 26 SCHEDULE 6: YOUR REPRESENTATIONS 30
SECTION TWO: SUMMARY OF CONFLICTS OF INTEREST POLICY 31
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SECTION ONE: Terms of Business for Investment ServicesDEFINITIONS
UnlessotherwisedefinedelsewhereintheseTermsofBusiness,thefollowingwordshavethefollowingmeanings:
“Account Relationship Type”meansthetypeofrelationshipyouhavewithusinrelationtoyourInvestmentAccount(namely,whetheryouhaveanAdvisedAccountRelationshiporaNon-AdvisedAccountRelationship);
“Advised Account Relationship”describestherelationshipbetweenyouandCitiwhenyouuseourInvestmentAdvisoryServiceinrelationtoyourInvestmentAccount;
“Advisory Fee”meansthefeethatwechargefortheprovisionoftheInvestmentAdvisoryService,assetoutintheKeyFactsDocument;
“Applicable Law”meansapplicablelaw,regulations,legalprocess,courts,regulatorycodesofconductandguidanceandanyagreemententeredintowithorbetweenAuthorities,including,butnotlimitedtotheFCARulesandthePRARules;
“Asset”meansanyinvestmentsorassetsheldinyouraccountwithusorinanomineenameforyourbenefit(includinganythingheldbyouragents,depositaryorcustodianoronaclearingsystem)andanyrightsorbenefitsrelatingtothoseinvestmentsorassets(includinganyincomederivedfromthoseinvestmentsorassets).Thisincludes,butisnotlimitedto,accounts,contractrights,alldocuments,InvestmentProducts,instrumentsandcertificatesrelatingtoinvestmentsandsecurities,andallrelatedinterest,redemptionsanddistributionsandallincome,proceedsandproductsoftheabove;
“Authority”meansanycompetentregulatory,taxorprosecutingauthorityinanyjurisdiction;
“Bank Account”meansyourCiticurrentaccountoryourCitisavingsaccount;
“Bank Recovery and Resolution Directive”or“BRRD”meansDirective2014/59/EU;
“Best Execution Policy”meansthepolicywhichwefollowinordertocomplywiththerequirementunderApplicableLawthatwetakeallsufficientstepstoobtain,whenexecutingyourorders,thebestpossibleresultforyou;
“BRRD Entity”meansthoseEEAentitieswithinthescopeofDirective2014/59/EU,includingEEAcreditinstitutions,certainEEAinvestmentfirmsand/orcertainEEAsubsidiariesorparentsofsuchentities).Fortheavoidanceofdoubt,thisincludescertaincompaniesintheCitigroupOrganisation;
“BRRD Financial Instrument”meansallfinancialinstrumentsissuedbyaBRRDEntity;
“BRRD Resolution Authority”meansanyresolutionauthorityempoweredtoapplytheresolutiontoolsorexercisetheresolutionpowersundertheBRRD;
“Business Day”meansaday(otherthanSaturdayorSunday)onwhichbankpremisesareopenforgeneralbusinessinLondon;
“Cash ISA”meansanISAmadeupofcashsavings;
“Citi”,“we”,“us”,“our”referstoCitibankUKLimited,UKBranch,whoseregisteredofficeisCitigroupCentre,CanadaSquare,LondonE145LBandanyonewhosucceedsCitiortowhomCitiassignsitsrights;
“Citi UK Reference Exchange Rate”meanstheexchangerateappliedbyCiti.PleasecontactyourRelationshipManagerifyouwouldliketoknowfulldetailsoftheactualratethatisapplied;
“Citi Online”meansourinternetbankingandinvestmentservicewhichenablesyoutoaccessandmanageyourInvestmentAccountonline;
“Citigroup Organisation”meansCitigroupInc.andanyofitssubsidiaryentities;
“Conflicts of Interest Policy”meansthepolicyfollowedbyCitiinordertoidentifyandtopreventormanageactualorpotentialconflictswhichariseinthecourseofCitiprovidingservicestoyou;
“Custodian”meansCitior,whereCitiisnotprovidingCustody
Services,thethirdpartyselectedbyCititoprovidesafecustodyofAssets;
“Custody Account”hasthemeaninggiventoitinclause2.22.2;
“Custody Service”meansthecustodyservicesofferedbyCitiinaccordancewithclause2.22;
“Debt”meansanypaymentordeliveryobligationthatyouhavetous(whetherexistingorfuture,directorindirect,actualorconditionaluponaneventoccurring),including(whererelevant):
(a) anyamountowingpursuanttoloans,overdrafts,interest,fees,expenses,costs,damagesorguarantees;
(b) anyamountowingpursuanttocontractsmadebyyouinconnectionwithforeignexchange,derivativesorsecuritisedtransactions(forthesepurposessuchamountsmaybebasedonourcurrentvaluationofunsettledcontracts);
(c) anyamountowingforpaymentsorundertakingsthatwemakeorenterintoonyourbehalforonyourinstructions;and
(d) anyamountowingforinterestandfeesonanyamountsin(a)to(c)aboveuntilallamountshavebeenpaid.Ifwemakeademand,orobtainacourtjudgmentagainstyou,interestandfeeswillcontinuetoaccrueattheratessetoutintheseTermsofBusinessastheydidbeforehand;
“Distance Communication”meansanymeansofcommunicationwithoutthesimultaneousphysicalpresenceofourrepresentativesandyou;
“EEA”meansEuropeanEconomicArea;
“Execution Service”meansourserviceofexecutingtransactionsforyouinrelationtoInvestmentProducts,includingarrangingexecutionforinvestmenttransactionsandanyotherrelatedserviceswhichweprovidetoyou(asfurthersetoutinclauses2.18to2.20);
“FCA”meanstheFinancialConductAuthority,of12EndeavourSquare,Stratford,LondonE201JN;
“FCA Rules”meanstherules,guidance,principlesandcodesintheHandbookofRulesandGuidanceissuedbytheFCA(including,fortheavoidanceofdoubt,provisionsofdirectlyapplicablelegislationthatarereproducedintheHandbook;
“Fund/Funds”meansoneormore‘regulatedcollectiveinvestmentscheme’asdefinedbytheFCARulesbeinganOpen-EndedInvestmentCompanyincorporatedundertheOpen-EndedInvestmentCompaniesRegulations2001,aunittrustschemewhichisauthorisedforthepurposesoftheFinancialServicesandMarketsAct2000ortheirnon-UKdomiciledequivalentswhichhavebeenrecognisedbytheFCA(whetherornottheunitsareheldwithinanISA);
“Global Custody Fee”meansthefee(assetoutintheKeyFactsDocument)thatwechargeforcustodyserviceswhichareprovidedbyuspursuanttoclause2.22orbyathirdpartyCustodianpursuanttoclause2.24;
“Investment Account”meansyourCitiinvestmentaccount;
“Investment Account Holder”meansthepersonorpersonsinwhosenametheInvestmentAccountisheld;
“Investment Advisory Service”meansourserviceofprovidingpersonalrecommendationstoyouinrelationtoInvestmentProducts,afteryouhaveundergoneourprofileandneedsanalysiswhichincludes:
(a) aninitialdiscussionwithyou;
(b) assessingyourknowledgeandexperience;and
(c) assessingyourfinancialsituation,investmentobjectivesandrisktoleranceandprovidingpersonalisedinvestmentrecommendationswhicharesuitableforyou;
“Investment Costs and Charges Illustration”meansanillustrationshowingthecumulativeeffectofcostsandchargesonreturnwhenprovidingourinvestmentservices;
“Investment ISA”meansanISAmadeupofstocksandsharesinvestments;
“Investment Product”meansinvestmentsofalltypeswhichinclude,butarenotlimitedto:
(a) InvestmentISAs;
(b) structuredproducts;
(c) Funds;
(d) exchangetradedproducts;
(e) fixedincomeproducts;and
(f) equities;
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“Investment Product Terms”meansthetermsandconditionswhichrelatetospecificInvestmentProductswhichyoumayinvestinfurthertotheInvestmentServicesprovidedbyCitiundertheseTermsofBusiness(unlessindicatedotherwise).SomeoftheInvestmentProductTermsarephysicallyincorporatedinthisdocumentinSchedule2andtheriskdisclosuresinSchedule4;othersmaybecontainedinaseparatedocument–seeSchedule2andSchedule4fordetails;
“Investment Services”meansourservicesinrelationtoInvestmentProducts,comprisingInvestmentAdvisoryServices,Non-AdvisedServices,ExecutionServicesandCustodyServices;
“Investments”meanssharesorunitsintheFundsorotherinvestmentswhichareeligibleforinclusioninaPlanfromtimetotime;
“ISA”meansan“IndividualSavingsAccount”;
“ISA Application”meanstheapplicationthatmustbecompletedtoenableyourPlantobeopened.YoumaymakeanISAApplicationbycompletingandsubmittinganapplicationform(eitherinhardcopyorviaCitiOnline)orbytelephone(inwhichcaseyourapplicationwillbecompleteonceaRelationshipManagerhasobtainedtheinformationrequiredfromyou(andyouwillbeprovidedwiththerelevantdocumentation)).
“ISA Terms of Business”meansPart3oftheseTermsofBusinessaswellastheinformationprovidedtoyouandreceivedfromyouwhenyoucompleteyourISAApplication;
“Joint Investment Account”meansanInvestmentAccountheldinthenamesoftwoormoreInvestmentAccountHolders;
“Joint Investment Account Holder”meanstheInvestmentAccountHoldersinwhosenamesaJointInvestmentAccountisheld;
“Key Facts Document”meansthedisclosuredocumentwhichcontainskeyinformationaboutourservicesincludingthescopeofanyadvicewemayprovideandinformationaboutfees,commissionsandchargesinrelationtotheInvestmentServices,andInvestmentProducts;
“Key Information Document”or“KID”hasthemeaninggiventoitinclause2.25.1;
“Lien”meansarightwhichentitlesustoholdontoanyofyourInvestmentProductsorclientmoneywehaveinourpossessionpendingpaymentofaDebtowedbyyou;
“Limit Order”meansanorderthatyouplacetobuyorsellafinancialinstrumentatitsspecifiedpricelimitorbetterandforaspecifiedsize.TheLimitOrderwillbetriggeredforexecutionwhenthepriceofthatfinancialinstrumentreachesthespecifiedlevelandthespecifiedsizeoftheorderisavailable.OncetheLimitOrderhasbeentriggeredatthespecifiedlevelandsize,theorderwillbeexecutedatthesame(orbetter)asthepricespecifiedintheLimitOrder;
“Non-Advised Account Relationship”describestherelationshipbetweenyouandCitiwhenyouuseonlyourNon-AdvisedServicesassetoutinfurtherdetailinclause2.2.1.2;
“Non-Advised Services”hasthemeaninggiveninclause2.10;
“Packaged Retail and Insurance-Based Investment Products”or“PRIIP”meansa“packagedretailandinsurance-basedinvestmentproduct”asdefinedunderApplicableLaw;
“Plan”meansanInvestmentISAasheldundertheISATermsofBusiness;
“Plan Manager”meansCitibankUKLimitedwithitsregisteredofficeatCitigroupCentre,CanadaSquare,LondonE145LB.CitibankUKplcisapprovedbyHMRevenueandCustomstoactasaPlanManagerundertheRegulations;
“PRA”meanstheUKPrudentialRegulationAuthority,itsagentsoranysuccessorbodyorsuccessorbodies;
“PRA Rules”meanstherules,guidance,principlesandcodesintheRulebookissuedbythePRA;
“Regulated Market”hasthemeaninggiventoitintheRules;
“Regulations”meanstheIndividualSavingsAccountRegulations1998,asamendedfromtimetotime;
“Relationship Manager”meansanemployeeofCitiregisteredandauthorisedtoprovidefinancialadvice;
“Retail Investment Product”meansproductsofferedbyuswhichareretailinvestmentproductswithinthemeaninggiventothattermintheglossaryoftheFCARules,whichincludesthefollowing:
(a) aunitinacollectiveinvestmentscheme;
(b) aninterestinaninvestmenttrustsavingsscheme;
(c) asecurityinaninvestmenttrust;
(d) astructuredcapital-at-riskproduct;or
(e) anyotherinvestmentwhichoffersexposuretounderlyingfinancialassets,inapackagedformwhichmodifiesthatexposurewhencomparedwithadirectholdinginthefinancialasset;
“Rules”meanstheFCARulesand/orthePRARules;
“SMS”meanstheshortmessagingtextserviceprovidedthroughmobilephones;
“Terms of Business”meansthesetermsofbusinessforourInvestmentAdvisoryServices,asmaybeamendedfromtimetotime,togetherwiththetermscontainedintheKeyFactsDocumentandtheInvestmentCostsandChargesIllustration;
“Trading Venue”hasthemeaninggiventoitintheRules;
“Transaction Against Advice”meanswhereyoutransactcontrarytoadvicegivenbyCiti;
“Transaction Fee“meansthefeethatwechargefortheexecutionofatransactioninanInvestmentProductassetoutintheKeyFactsDocument;
“UK”meansEnglandandWales,ScotlandandNorthernIreland(butnottheChannelIslandsortheIsleofMan);
“US person”means:• acitizenorresidentoftheUnitedStates;
• adomesticpartnershiporganisedunderthelawsoftheUnitedStates;
• adomesticcorporationorganisedunderthelawsoftheUnitedStates;
• anyestateotherthanaforeignestate;
• anytrustif:
– acourtwithintheUnitedStatesisabletoexerciseprimarysupervisionovertheadministrationofthetrust;and
– oneormoreUnitedStatespersonshavetheauthoritytocontrolallsubstantialdecisionsofthetrust;
• anyotherpersonthatisnotaforeignperson;
“Withholding Tax”meansanamountfororonaccountof,orwhichrepresents,incometax,valueaddedtax,taxonthesaleordispositionofanyproperty,duties,oranyotherlawfullycollectedamount;and
“you/your”meansorreferstotheholderorholdersoftheInvestmentAccount.
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IMPORTANT NOTE:
Pleasenotethattherearerisksassociatedwithanyinvestmentandthatthevalueofyourinvestmentmaygodownaswellasup.Schedule4setsoutsomeimportantinformationregardingcertainInvestmentProductsinrelationtowhichweofferourInvestmentServices,alongwithcertainotherInvestmentProducts,andriskwarningsrelatingtothoseproducts.ThepurposeofthatinformationistoenableyoutounderstandthenatureandrisksofthespecifictypesofInvestmentProductsweprovideourservicesinrelationto.YoushouldreadSchedule4,andinparticulartheriskwarningsitcontains,carefully.FordetailsontherisksassociatedwithotherInvestmentProductsofferedbyCiti,pleaseseethedocumentationprovidedonyourapplicationforthoseInvestmentProducts.
Unlessotherwisenotifiedtoyou,InvestmentServiceswillbeinrelationtofinancialinstrumentsforwhichtheidentifiedtargetmarketincludesretailclients.
PART 1: GENERAL PROVISIONS AND YOUR RELATIONSHIP WITH CITI
TheseTermsofBusiness,includingtheSchedules,theKeyFactsDocumentandtheInvestmentCostsandChargesIllustration,formpartofthecontractualagreementbetweenyouandus.
Inaddition,whenyoupurchaseaninvestment,youmaybesubjecttoadditionalInvestmentProductTermsrelatingtothatproduct.SomeoftheInvestmentProductTermsarephysicallyincorporatedinthisdocumentinSchedule2andothersmaybecontainedinaseparatedocument–seeSchedule2fordetails.YoucanfindfurtherinformationontheservicesweofferinrelationtoInvestmentProductsatPart2,Part2A,Part2BandPart2CoftheseTermsofBusiness.YoucanalsofindriskdisclosuresandfurtherinformationoncertainInvestmentProductsatSchedule4.
TotheextentthatthereisanyinconsistencybetweentheseTermsofBusinessandtheGeneralTermsandConditionsforCitiCurrentAccountsandSavingsAccounts,theseTermsofBusinesswillprevail.
IfthereisanyconflictbetweentheseTermsofBusinessandanyInvestmentProductTerms,thoseInvestmentProductTermswilltakeprecedence.
1. INTRODUCTION
TheseTermsofBusinesstakeeffectfromthedatewhen:
(a) yourInvestmentAccountisopened;
(b) youbuyanInvestmentProductthroughCiti;or
(c) youreceiveanyadviceinrelationtoanInvestmentProduct,whicheveroccursfirst.
Theseareourstandardclienttermsofbusinessonwhichweintendtorely.Foryourownbenefitandprotectionyoushouldreadthesetermscarefully.Ifyoudonotunderstandanypoint,pleaseaskforfurtherinformation.
CitibankUKLimitedisauthorisedbythePrudentialRegulationAuthorityandregulatedbytheFinancialConductAuthorityandthePrudentialRegulationAuthority.ItappearsontheUK’sfinancialservicesregisterwithfirmreferencenumber805574.CitibankUKLimitedisacompanylimitedbysharesandregisteredinEnglandandWaleswithregistrationnumber11283101.CitibankUKLimited’sregisteredaddressisCitigroupCentre,CanadaSquare,CanaryWharf,LondonE145LB.ItsVATnumberis429625629.
TofindoutmoreaboutuspleaseseethePRA/FCAregisteratwww.fca.org.uk/registerorcalltheFCAon08001116768orPRAon02034614878.
ThecontactaddressoftheFCAis12EndeavourSquare,Stratford,LondonE201JN.
ThecontactaddressofthePRAis20Moorgate,LondonEC2R6DA.
Citi’spermittedbusinessincludes:
(a) advisingonandarrangingdealsincollectiveinvestmentschemes;and
(b) advisingonandarranginginvestmentbusiness.
CitiwilltreatyouasaretailclientforthepurposesoftheApplicableLaw.YoushouldbeawarethatbeingtreatedasaretailclientwillnotnecessarilymeanthatyouwillhaverightsundertheUKFinancialServicesCompensationScheme(pleaseseeclause1.9forfurtherdetails).
TheseTermsofBusinessdonothaveanyminimumormaximumdurationandeitheryouorwemayterminatetheseTermsofBusinessatanytimebygivingwrittennoticeassetoutinclause1.5.
1.1 Amending these Terms of Business
1.1.1 Citimaychange,vary,amendorsupplementtheseTermsofBusinessbygivingyouatleast30days’writtennoticeofthechanges.Citimaymakechangestotakeaccountofanyofthefollowingfactors:
1.1.1.1 wherewereasonablyconsideritwillmaketheseTermsofBusinesseasiertounderstand,clearerorfairertoyouorthechangewouldnotbetoyourdisadvantage;
1.1.1.2 tomaketheseTermsofBusinessmorefavourabletoyouortocorrectamistake(providedthatanycorrectionwouldnotbedetrimentaltoyourrights);
1.1.1.3 toreflectanychangesinthecostofprovidingourservicestoyou(wherethechangemadewillreflectthechangeincoststous);
1.1.1.4 toreflectchangesinthenatureorscopeoftheserviceweprovidetoyouoroftheservicewearrangetohaveprovidedtoyou;
1.1.1.5 totakeaccountofchangestoApplicableLaw,codesofpracticeorthewayinwhichweareregulated;or
1.1.1.6 whereweconsideritnecessarytomakereasonablechangestothewaywelookafteryourInvestmentAccountorprovideservicestoyouasaresultofchangesinoursystems(forinstance,changesintechnologyorthestructureofanyCitigroupOrganisation(s)).
Wherewereferto‘changes’inthelistoffactorsabovethisincludesbothchangesthathavealreadyoccurredorchangesthatwereasonablyexpecttooccur.
1.1.2 Whereweproposetomakeachangetoanyfeesorchargespayablebyyou,inaccordancewithclause1.1.1above,toreflectachangewhichhasoccurred(orwhichwereasonablyexpectwilloccur)inApplicableLawortheunderlyingcostsweincurinprovidingourservicestoyou,wewillensurethatthechangeinourfeesandchargesreflectsafairproportionofwhatwereasonablyexpectthecostoftheregulatoryrequirementorunderlyingcostswillbetous,andwillinformyouofanysuchchangesinwritingatleast30dayspriortothechange.
1.1.3 Ifyoudonotagreewithanychangewepropose,youmayatanytime(subjecttoyousettlingalloutstandingliabilitiesundertheseTermsofBusiness)terminatetheseTermsofBusinessinaccordancewithclause1.5andwewillwaiveanyfeeswhichmayotherwisehavebeenpayableupontermination.
1.2 Notices and communications
1.2.1 AllcommunicationsbetweenCitiandyouwillbeintheEnglishlanguage.Citimay,fromtimetotimeandonlyatyourrequest,communicatewithyouinanotherlanguage,butyouacknowledgethatCitiisnotrequiredtodothis.AnycommunicationsfromCititoyouinEnglishwillbebindingonyouevenifCitihascommunicatedwithyouinanotherlanguagepreviously.UnlessCitiagreestothecontraryinrelationtoaspecificcommunication,allcommunicationsfromyoutoCitimustbeinEnglish.
1.2.2 Youcansendnoticesandcommunicationstousatthefollowingaddress:CitibankUKLimited,POBox4012,Swindon,SN44JZ.Inaddition,forgeneralenquiriespleasecontactyourRelationshipManager(detailsofwhomwillbeprovidedonopeningofyourInvestmentAccount,ifapplicable),orcalluson0800005500.
1.2.3 Anylettersentbyyoutousattheaddressinclause1.2.2above,oranylettersentbyustoyouattheaddresswhichyouhavemostrecentlynotifiedtous,shallconstitutewrittennoticeundertheseTermsofBusiness.
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1.2.4 AnyemailwhichwesendtotheemailaddressyouhavemostrecentlynotifiedtousandanymessagewesendtoyouviaCitiOnlineshallconstitutewrittennoticeundertheseTermsofBusiness.
1.2.5 IngeneralwewillconsidernoticesorothercommunicationssentbyusbyemailorviaCitiOnlineashavingbeenreceivedbyyouoneBusinessDayaftertransmission.
1.3 Market information, research or reports
1.3.1 Whenmarketinformation,researchorreportsareprovided,Citi:
1.3.1.1 isnotresponsibletoyoufortheiraccuracyorcompletenessunlesstheyhavebeenproducedbyCiti;
1.3.1.2 isnotresponsibletoyouforthetaxconsequencesofanytransaction(althoughinrelationtocertainInvestmentProductsCitimayberequiredbytheApplicableLawtoprovideanindicationofwhatthetaxconsequencesofinvestinginsuchanInvestmentProductmightbe);
1.3.1.3 hasnoobligationtobringinvestmentopportunitiestoyourattentionortoupdatetheinformation,researchorreportsprovided;
1.3.1.4 willnotprovideanytaxadvice,andshallnotatanytimebedeemedtobeunderanydutytoprovidetaxadvice;
1.3.1.5 mayfromtimetotimesendpublishedresearchandreports,advertisementsandotherpublicationstoyou,andwhereanysuchdocumentcontainsarestrictiononthepersonorcategoryofpersonsforwhomthatdocumentisintendedortowhomitisdistributed,youagreethatyouwillnotpassitontoanypersonorcategoryofpersonswhofalloutsidethatrestriction;
1.3.1.6 mayhaveacteduponreportsorotherdocumentationprovidedtoyou,ormadeuseoftheinformationonwhichitisbased,priortosendingsuchdocumentationtoyou;and
1.3.1.7 makesnocommitmentastothetimeofreceiptbyyouofresearchorreportsandcannotguaranteethatyouwillreceivesuchresearchorreportsatthesametimeasotherclientsofCiti.Pleasenotethatanysuchpublishedresearchorreportsmayappearinoneormoreelectronicorotherinformationservices.
1.3.2 UnlessCitispecificallyagreesotherwiseinwritingwithyou,youherebyacknowledge:
1.3.2.1 thattheinformationgiventoyouunderclause1.3.1abovemaybedifferentfromthatprovidedtootherclientsofCitiduetoindividualanalysisoffundamentalandtechnicalfactorsbydifferentpersonnel;and
1.3.2.2 thatsuchinformationmaynotbeconsistentwithCiti’sproprietaryinvestments,orthoseofotherCitigroupOrganisations,ordirectors,employeesoragentsofCitiorotherCitigroupOrganisations.
Thisclause1.3willnotaltertheareaswherewehaveacceptedliability,assetoutinclause1.11.4.
1.4 Cancellation rights
1.4.1 WhereCitientersintotheseTermsofBusinesswithyouatadistance(i.e.whereCitihasnoface-to-facecontactwithyou)youshouldrefertoSchedule1oftheseTermsofBusiness,whichcontainsimportantadditionalinformationaboutCitiandyourindividualrights,includingcancellationrights.
1.4.2 YoumayalsohaveadditionalcancellationrightswhereyouenterintocontractsforspecifictypesofInvestmentProducts.WherethisappliestheserightswillbeclearlysetoutintherelevantInvestmentProductTerms.
1.5 Terminating these Terms of Business
1.5.1 YoumayterminatetheseTermsofBusinessatanytimebyprovidingCitiwithwrittennotice.YournoticewilltakeeffectfromthedateCitireceivesyourwrittennotice.WhenyougiveuswrittennoticethatyouwishtoterminatetheseTermsofBusinessunderthisclause1.5.1,thisshouldbeaccompaniedbyaninstructiontoustotransferyourAssetstoathirdpartyortoliquidateyourAssets.
1.5.2 IfweoryouterminatetheseTermsofBusinessoraparticularInvestmentProductinaccordancewiththisclause1.5wewillaskyouwhetheryouwantustotransferyourInvestmentProducttoathirdpartyortosellthemandremittheproceedsofsaletoyou.Ifyoudonotnotifyusofyourpreferencewithin10BusinessDaysoftermination,wemayatourdiscretion,actingreasonably,sellanysuchInvestmentProductandremittheproceedstoyou.AnytransfersofInvestmentProductmaybeatyourcost.
1.5.3 CitimayterminatetheseTermsofBusinessoraparticularInvestmentProductatanytimeby30days’priorwrittennoticetoyou.Citimaydosoasaresultofanyofthefollowingfactors:
1.5.3.1 totakeaccountofadecisionbyacourt,ombudsman,regulatororsimilarbodyorchangestoApplicableLaw,codesofpracticeorthewayinwhichweareregulated;
1.5.3.2 youareinrepeatedorseriousbreachoftheseTermsofBusiness;
1.5.3.3 youbehaveinanabusiveorthreateningmannertowardsourstaff;
1.5.3.4 wereasonablybelieveyouhavemovedoutsidetheUK;
1.5.3.5 youhavegivenusinaccurateinformationand,hadwereceivedaccurateinformation,wewouldnothaveacceptedyourInvestmentAccountapplicationoryourpurchaseofaparticularInvestmentProduct;
1.5.3.6 wenolongerprovideanyoralloftheservicesdescribedhereintoourclients.WhereweceasetoactasPlanManagerforthepurposesoftheRegulations,wewillalsonotifyyouofyourrighttotransferyourPlan;or
1.5.3.7 youareaUSpersonandyoufailtoprovideuswithavalid,signedFormW-9inaccordancewithclause1.13.7.
1.5.4 CitimayterminatetheseTermsofBusinessoraparticularInvestmentProductwithimmediateeffectandwewillinformyouimmediately,foranyofthefollowingreasons:
1.5.4.1 wereasonablysuspectthatyouareusingtheservicesprovidedundertheseTermsofBusinessforanillegalpurpose;
1.5.4.2 wereasonablysuspectthatyouhavegivenfalseinformationwhichhasamaterialimpactonourrelationshipwithyou;or
1.5.4.3 achangeinyourcitizenship,residencyorimmigrationstatusmeansthatitisnolongerpermissibleforustoprovideservicestoyouincompliancewithApplicableLaw.
1.5.5 Youshallberesponsibleforpayingallfees,charges,earlywithdrawalfees,andotherobligationsthatremainunpaidatthetimetheseTermsofBusinessareterminated.IfyouterminatetheseTermsofBusinesssubsequenttousvaryingthetermspursuanttoclause1.1,orifweterminatetheseTermsofBusinessunderclause1.5.3orforareasonstatedinclause1.5.4.3,wewillnotchargeyouanyearlywithdrawalfees.TheproviderofanInvestmentProductmaychargeanearlywithdrawalfeeandyoushouldchecktherelevantInvestmentProductTerms.IfCitihasprocessedanytransactionthatislikelytocompletebeyondthedateoftermination,Citimayatitsdiscretion,actingreasonably,closeoutorcompletesuchtransactionandshallbeentitledtoretainsufficientfundsorAssetsforthispurpose.
1.5.6 YoushallberesponsibleforanymarketlossesnecessarilyrealisedinsettlingorconcludingoutstandingobligationswhentheseTermsofBusinessareterminated.
1.5.7 TerminationoftheseTermsofBusinessshallnotaffecttherepaymentofanyDebtalreadyincurredbyyoutoCiti.
1.6 No waiver and severability
1.6.1 YouagreethatnodelayinusenforcingourrightsundertheseTermsofBusinesswillbeconstruedasawaiverofourrights.OnlyawrittenwaiversignedbyCitiwillbevalid.
1.6.2 Inaddition,ifanypartoftheseTermsofBusinessisfoundtobeunenforceablebyacourt,therestoftheTermsofBusinesswillstandandbereadasifthatpartwerenotincluded.
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1.7 Monitoring and recording
1.7.1 Alltelephoneconversationsandelectroniccommunicationsbetweenyouandusthatresultormayresultintransactionsinfinancialinstrumentswillberecorded.Thismaybewithoutuseofawarningthataspecificconversationisbeingrecorded.
1.7.2 Acopyofthetelephonerecordingsorelectroniccommunicationsreferredtoinclause1.7.1willbeavailabletoyouonrequestforaperiodoffiveyearsfromthedateofthecommunicationand,whererequestedbytheFCAorotherCompetentAuthority(asdefinedintheFCARules),foraperiodofuptosevenyears.
1.7.3 Withoutprejudicetoclause1.7.1,toensurethatyourinstructionsarecarriedoutaccurately,tohelpcontinuallyimprovetheserviceandintheinterestsofsecurity,wemaymonitorandrecordtelephoneandvideoconferencecallswithyou.
1.7.4 Weshallhavetheauthoritytodelivercopiesoftranscriptsofsuchrecordingstoanycourtorregulatoryauthorityofcompetentjurisdictionasweseefitandyouherebywaiveanyobjectiontotheuseofanysuchrecordingsasevidenceofanysuchtelephoneconversation.
1.7.5 Monitoringiscarriedoutonlyforlawfulbusinesspurposesincluding:toestablishtheexistenceoffactsrelevanttothebusiness;toascertaincompliancewithregulatoryandself-regulatorypracticesandproceduresthatarerelevanttothebusiness;toascertainordemonstratestandardsthatemployeesachieveoroughttoachievewhenusingthecompany’stelecommunicationssystems;topreventordetectcrime;toinvestigateordetectunauthoriseduseofbusinesspremisesand/orthetelecommunicationssystems;andtoensuretheeffectiveoperationofthecommunications.
1.8 Your information and how we use it
1.8.1 Youmustprovideuswithsuchinformationaswemayreasonablyrequirefromtimetotime,andmustupdatethatinformationaswereasonablyrequirefromtimetotime,toenableusoranyCitigroupOrganisationtocomplywithanyApplicableLaw.Youmustcontactusimmediatelyoratthelatestwithin30daysifatanytimeinthefuturethereisamaterialchangetoinformationyouhavepreviouslyprovidedtous.
1.8.2 Exceptwherewehavebeennegligentorfraudulentorinwilfuldefault,weshallhavenoresponsibilitytoyouifanyinformationweholdaboutyouisorbecomesinaccurateorincomplete.
1.8.3 FOR INFORMATION EXPLAINING HOW CITI COLLECTS AND USES PERSONAL INFORMATION, PLEASE SEE OUR CONSUMER BANKING PRIVACY STATEMENT WHICH YOU CAN VIEW AT: citibank.co.uk/privacy
1.8.4 Youhavetherightofaccesstoyourpersonalrecordsheldbycreditandfraudagencies.PleasecontactCitiPhoneon0800005500ifyouwouldlikedetailsoftheagenciesweuse.Thesesourcesmayvarydependingonthedifferenttypesoftransaction.
1.8.5 Theinformationreferredtoinclause1.8.3abovemayrelatetoyou,asourindividualcustomer,ortootherindividualswhosepersonalinformationyou(orsomeoneonyourbehalf)mayprovidetousinconnectionwithyourAccountsorourrelationship.BeforeprovidinguswithinformationaboutsuchotherindividualsyoumustnotifythemoftheConsumerBankPrivacyStatementandwhererequired,obtaintheirconsenttotheuseandotherprocessingoftheirpersonalinformation.
1.9 Compensation
1.9.1 TheFinancialServicesCompensationScheme(the“FSCS”)providescompensationincertaininstanceswhereCitiisunable,orlikelytobeunable,tosatisfyprotectedclaimsagainstit.Insuchcircumstances,theFSCSmayprovidecompensationforclaimsrelatingtoinvestmentmediationservicesprovidedbyCiti.However,theFSCSisgovernedbyspecificrulesoncompensationwhichdetermineyoureligibility,thecircumstancesinwhichcompensationwillbeavailabletoyouandthelimitsoncompensationpayabletoyou.AnyrecoveryundertheFSCSisthereforesubjecttoyourspecificcircumstances,thenatureofyourclaimandthespecificrulesoftheFSCS.
1.9.2 Wewillprovidefurtherinformationontheconditionsgoverningcompensationandtheformalitieswhichmustbecompletedtoobtaincompensationuponrequest.AsatApril2019,theFSCSlimitforprotectedinvestmentbusinessissetat100%of£85,000perpersonperauthorisedfirm.
AdditionalinformationontheFSCSandeligibilitytoclaimisavailablefromtheFSCS’swebsite:www.fscs.org.uk,oryoucancontacttheFSCSat:
FinancialServicesCompensationScheme 10thFloor,BeaufortHouse 15StBotolphStreet LondonEC3A7QU
Tel:08006781100or+442077414100 Email:[email protected]
1.10 Complaints
1.10.1 IfyouareunhappywithanyaspectsoftheservicesprovidedundertheseTermsofBusiness,wehaveproceduresinplacetodealwithyourconcernseffectively.Youshouldbringyourcomplainttoourattentionbycontactingus.Youcancontactusinwritingat:CitibankUKLimited,ComplaintOfficer,POBox4012,SwindonSN44JZ,orbytelephoneon0800005500.Citiwillaimtodealwithanycomplaintspromptlyandfairly.Acopyofourcomplaintsprocedureisavailableonrequest.Ifyouremainunhappyafteryouhavegivenusthechancetoputthingsright,youmaybeabletocontacttheUKFinancialOmbudsmanServiceat:
TheFinancialOmbudsmanService ExchangeTower
LondonE149SRUnitedKingdom
Tel:+442079641000Email:complaint.info@financial-ombudsman.org.ukwww.financial-ombudsman.org.uk
1.11 Limits on liability of Citigroup Organisation
1.11.1 Interveningevents/eventsbeyondourreasonablecontrol:ExcepttotheextentrequiredbyApplicableLaw,Citishallnotbeliableforanyactoromission,orfailureordelayinexecutinganinstruction,causedbycircumstancesbeyondCiti’sreasonablecontroltoprevent,suchasactsofGod,fires,strikes,terrorism,powerfailures,interventionbyexchangesorregulators,courtorders,oranyfailureorerrorofanyequipment,computersystem,telecommunications,intermediary,agent,exchange,orcounterpartynotreasonablywithinourcontrol.
1.11.2 WewillnotbeliabletoyouforanyfailuretoperformourobligationsundertheseTermsofBusinesswhereperformanceofthatobligationwouldhaveputusoranyotherCitigroupOrganisationorourortheirthirdpartyserviceprovidersinbreachofApplicableLaworanyregulatoryduty.
1.11.3 Wewillnotbeliabletoyouinanycircumstancesfor:
1.11.3.1 lossofbusiness,lossofgoodwill,lossofopportunity,lossofprofit;or
1.11.3.2 anylosstoyouthatwecouldnotreasonablyhaveanticipatedwhenyougaveusaninstructionundertheseTermsofBusiness.
1.11.4 NothingintheseTermsofBusinesswillexcludeorlimitanyliabilitywehaveasaresultofactingfraudulentlyornegligentlyorourfraudulentmisrepresentationorwilfuldefault;orunderanylegaldutywehavetoyou;orinrespectofanyliabilitythatwearenotallowedbylawtoexclude.
1.11.5 WherethirdpartiesareusedbyyouorbyusonyourbehalfpursuanttotheseTermsofBusiness(forexample,athirdpartyCustodian),theymayacceptdifferentliabilitytoyoufortheparticularservicethattheyoffer.Thefullextentoftheirliabilitywillbesetoutintheirtermsofbusinesswithyou,whichyoushouldreadcarefully.
1.12 Fees, expenses and benefits
1.12.1 TheKeyFactsDocumentandtheInvestmentCostsandChargesIllustrationcontaininformationaboutfees,charges,commissionsandminimumbalancerequirements.
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1.12.2 Youagreetopayallofthefees,charges,stampduties,valueaddedandothertaxes,legalandvaluationfees,andothercostsandexpenses(“Expenses”)inrelationtotheservicesweprovidetoyouundertheseTermsofBusinessandassociatedwiththeoperationofanyInvestmentAccountandanyserviceCitiorathirdpartyCustodianprovidesforyou.
1.12.3 UndertheFCARuleswearerequiredtoaggregatecertaincostsandchargesinformation.Youareentitledtorequestanitemisedbreakdownofsuchinformation.
1.12.4 Clause1.13containsfurtherinformationabouttaxes(pleasethereforerefertoclause1.13inthisregard).
1.12.5 Inducements
1.12.5.1 Wemay,fromtimetotime,wherepermittedunderApplicableLaw,giveorreceivemonetaryornon-monetarybenefitstoorfrom(orsharethemwith)otherCitigroupOrganisationsorthirdpartiesinrelationtotheprovisionofanyserviceprovidedtoyouorinvestmentsmadeundertheseTermsofBusiness,whichwillbenotifiedtoyouasrequiredbyApplicableLaw.
1.12.5.2 FurtherinformationontheabovearrangementsisavailablefromyourRelationshipManager.
1.13 Taxes
1.13.1 Interestwepayyou,andinterest,dividendsandotherincomeandcapitalgainsfrominvestmentsmaybesubjecttotaxes,includingWithholdingTaxandsimilarcollectedamountsunderApplicableLaw.Youagreethatwemaywithholdtheamountofthesetaxesorcollectedamountsfrompaymentstoyouorforyouraccountoranyaccount.IfyouravailableAssetswithusdonotcoveryourliability,youagreetoprovideusondemandwithanyadditionalfundsrequired.
1.13.2 YouaresolelyresponsibleforpayingtaxesorreimbursingWithholdingTaxorsimilarcollectedamountsrelatedtoyouraccountsorarisingfromthepurchaseorsaleofyourpropertyorotherinvestments.Inaddition,youareresponsibleforanystamporexcisetaxesorestatetaxesassociatedwithyouraccounts.Ifwepayanyofthesetaxesforyou,youagreethatwemaydeducttheamountpaiddirectlyfromtheaccounts.Youshallpaytousanamountequaltotheloss,liabilityorcostwhichwedeterminehasbeen(directlyorindirectly)sufferedfororonaccountoftaxorsimilaramountbyusinrespectofyouraccountsorarisingfromthepurchaseorsaleofpropertyorotherinvestments.
1.13.3 Inaddition,youunderstandthatwehavenoobligationtoreclaimforyouanyexcesstaxesorotheramountswithheld.
1.13.4 AnyamountwithheldbyusshallbepaidinatimelyfashiontotherelevantAuthorityinaccordancewiththerelevantApplicableLaw.Youshallbenotifiedofanysuchwithholdingassoonasreasonablypracticable.Youacknowledgethatwewillnotberequiredtoreimburseyouforanyamountwithheldordeductedbyanythirdpartywithintheglobalpaymentsysteminfrastructure.
1.13.5 Youconfirmtousthatyouhaveprovidedtoandsecuredfromanypersonthatwillownabeneficialinterestinapaymentfromusanynotices,consentorwaivernecessarytopermitus,anyCitigroupOrganisation,andourandtheirserviceproviderstocarryouttheactionsdescribedinthisprovision.
1.13.6 THELEVELOFTAXYOUPAYWILLDEPENDONYOURINDIVIDUALFINANCIALCIRCUMSTANCESANDMAYCHANGEINFUTURE.
1.13.7 IMPORTANTTAXINFORMATION:IfyouareaUSpersonyoumustprovideuswithavalid,signedFormW-9.Ifyoudonotprovideuswithavalid,signedFormW-9within30daysfollowingourrequesttodoso,wemayterminatetheseTermsofBusinessorcloseanInvestmentProductbygivingyounoticeinaccordancewithclause1.5.
1.14 Conflicts of interest
1.14.1 InthecourseofCitiprovidingservicestoyouundertheseTermsofBusiness,certainactualorpotentialconflictsofinterestmayarise.AsrequiredbytheApplicableLaw,CitihasestablishedaConflictsofInterestPolicywhichsetsoutthepolicyfollowedbyCitiinordertoidentifyandtopreventormanagesuchconflicts.
1.14.2 BywayofexamplethesituationsinwhichconflictsofinterestmayarisearewhereweoranotherCitigroupOrganisationare:
1.14.2.1 dealinginarelevantinvestment,arelatedinvestmentoranassetunderlyinganinvestment,whetherasprincipalforitsownaccountorforathirdparty;
1.14.2.2 dealingwithorusingtheservicesofanintermediatebrokerorotheragent,whomaybeanotherCitigroupOrganisation,whilesellingtoorbuyingfromyou;
1.14.2.3 matchingatransactionforyouwithatransactionforanotherclientwhileactingonbehalfofbothyouandtheotherclient;
1.14.2.4 buyingfromyouandimmediatelysellingtoanotherclient,orvice-versa;
1.14.2.5 holdingaposition(includingashortposition)inanInvestmentProductinwhichyouhaveinvested,arelatedinvestmentoranassetunderlyingtheinvestment;
1.14.2.6 quotingpricestothemarketinanInvestmentProductinwhichyouhaveinvested,arelatedinvestmentoranassetunderlyingtheinvestment;
1.14.2.7 buyingorsellingunitsinacollectiveinvestmentschemewherewe(oranotherCitigroupOrganisation)arethetrustee,custodian,depositary,administrator,operatorormanager(oradvisertothetrustee,operatorormanager)ofthescheme;
1.14.2.8 advisingon,buying,sellingorrecommendingforyourInvestmentAccountsecuritiesofcompanieswhichhavedirectorsorofficerswhoarealsodirectorsorofficersofCitigroupOrganisationsorhavebankingorotherrelationshipswithCitigroupOrganisations;
1.14.2.9 beinginvolvedasanunderwriterorothercapacityinatake-over,newissueorothertransactioninvolvinganInvestmentProductinwhichyouhaveinvested,arelatedinvestmentoranassetunderlyingtheinvestment;and/or
1.14.2.10 advisingandprovidingotherservicestoCitigroupOrganisationsorotherclientswhomayhaveinterestsininvestmentsorunderlyingassetswhichconflictwithyourinterests.
Wewillassumethatyoudonotobjecttoouractingonthebasissetoutinthisclause1.14.2.
1.14.3 AsummaryoftheCitiConflictsofInterestPolicycanbefoundinSectionTwooftheseTermsofBusiness.ThesummaryoftheCitiConflictsofInterestPolicymaybeamendedfromtimetotime.WewillnotifyyouinadvanceofanymaterialchangestothesummaryoftheCitiConflictsofInterestPolicy.
1.14.4 SaveasrequiredbytheApplicableLaw,weshallnotbeobligedtodisclosetoyou,ortotakeintoconsideration,anyfact,matterorfindingwhichmightinvolveabreachofdutyorconfidencetoanyotherperson,orwhichcomestothenoticeofanyofourdirectors,officers,employeesoragentsbutdoesnotcometotheactualnoticeoftheindividualorindividualsdealingwithyou.
1.14.5 WherethearrangementsundertheCitiConflictsofInterestPolicytopreventormanageaparticularconflictarenotsufficienttoensurewithreasonableconfidencethattheriskofdamagetoyourinterestswillbeprevented,wewillprovideyouwithaspecificdescriptionoftheconflictsofinterestandexplainthegeneralnatureand/orsourcesoftheconflictsofinterest,aswellastherisksthatariseasaresultoftheconflictsofinterestandthestepstakentomitigatethoserisks.Thespecificdescriptionwillbeinsufficientdetailtoenableyoutomakeaninformeddecisionastowhethertoproceed.
1.14.6 Wemayalsodeclinetoactforyouwherewebelievethereisnootherpracticablewayofensuringthatyouandourotherclientsaretreatedfairly.
1.14.7 Wherewehavearrangedforathirdpartytoprovideservicestoyou,theymayhaveseparateactualorpotentialconflictsofinterestthatmayarise.Itistheresponsibilityofanysuchthirdpartytoprovideyouwithinformationregardingtheirpolicytowardsconflictsofinterest.
1.15 Non-public information
Citiisprohibitedincertaincircumstances(forexample,whereitissubjecttoconfidentialityobligations)fromusinginvestmentinformationthatisknowntoaCitigroupOrganisationbutnotgenerallyavailabletothepublic.Youagreethat,inthosecircumstances,CitiisnotresponsibleforanylossestoyourInvestmentAccountthatresultfromCitiwithholdingthisinformation.
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1.16 Citi Online
1.16.1 CitiOnlineallowsyoutoviewdetailsofyourInvestmentAccountsandgiveuselectronicinstructionsbyusingyourcomputerorotherelectronicdeviceprovidinginternetaccessandyourchosenusername,passwordandothersecurityinformation.
1.16.2 TheactivitiesthatcanbeperformedthroughCitiOnlinemayvaryfromtimetotime.Additionalguidanceonhowtousetheserviceisprovidedonourwebsiteatwww.citibank.co.ukorsuchotherwebsiteasisnotifiedtoyou.
1.16.3 YoucanuseCitiOnline24hoursaday(subjecttoavailabilityasexplainedfurtherinclause1.16.11)andwewillendeavourtocarryoutyourinstructionspromptly.However,certaininstructionswillonlybecarriedoutduringourbusinesshoursorexchangetradinghoursasappropriate.
1.16.4 YouinstructustocomplywithanyinstructionsgiventousthroughCitiOnlineandifwearegiventhoseinstructionsbymeansofyourusernameandpassword,weshallbeentitledtoassumethatthoseinstructionsaregivenbyyou.
1.16.5 YouwillberesponsibleforanycostsassociatedwithusingtheinternettoaccessCitiOnline.WemakenopromiseswithrespecttoeitherthespeedortheresolutionofCitiOnlineoryourabilitytogainaccesstoCitiOnlinefromanyparticularelectronicdeviceorlocationoratanyparticulartimeorforanyparticularpurpose.
1.16.6 CitiOnlinecanonlybeaccessedthroughbrowserswith128bitencryptioncapabilities.Theuseofsuchlevelsofencryptionmaybeconsideredillegalinsomejurisdictions.ItisyourresponsibilitytoensurethatyourabilitytouseCitiOnlineispermittedbythelawapplicabletowhereyouarelocatedwhenyouuseCitiOnline.WeshallnotberesponsibleforanylossordamagesufferedbyyouasaresultofnotbeingabletouseCitiOnlineinthesejurisdictions.
1.16.7 WehavetakenallreasonablestepstoensurethattransmissionspassingtoandfromCitiOnlineremainconfidentialandnotinterferedwith.However,byusingCitiOnlineyouacknowledgethatwecannotcompletelyguaranteetheprivacyorconfidentialityofanyinformationpassingovertheinternetorthatsuchinformationwillnotbeinterferedwith.
1.16.8 OnceyouhaveloggedontoCitiOnline,youmustnotatanytimeleaveyourcomputerorelectronicdeviceunattendedorallowanyoneelsetouseyourcomputerorelectronicdeviceuntilyouhaveloggedoff.Youwillberesponsibleforensuringthatyouhaveloggedoffattheendofeachsession.
1.16.9 YoumustnotaccessCitiOnlinefromanycomputerconnectedtoalocalareanetworkoranypublicinternetaccessdeviceoraccesspointwithoutmakingsurethatno-oneelsewillbeabletoobserveorcopyyourusername,passwordorothersecurityinformation.
1.16.10 Youmustneverrecordyourpasswordonanysoftwarewhichretainsitautomatically,forexampleany‘savepassword’featureonyourinternetbrowser.
1.16.11 WemaysuspendCitiOnlineoranypartofitwithoutnoticewhereweconsideritreasonablynecessarytodoso,forexamplewherethereisasuspectedbreachofsecurityortocarryoutmaintenance.TheremayalsobeotherinstancesofplannedorunplanneddowntimeduringwhichCitiOnlineisnotavailable,andwecannotpromisethatCitiOnlinewillbeinoperationatanyparticulartime.WewillinformyouthroughourwebsiteifCitiOnlineoranypartofitbecomesunavailable.
1.16.12 YouacknowledgethatyourCitiOnlinepassword,usernameandothersecurityinformationareuniquetoyouandcanbeusedbyyoutotransactonyourInvestmentAccountandgiveusinstructions,andyoupromisetokeepthesedetailssecretandtocomplywithanyadditionaltermsandconditionswhichapplytoCitiOnlinewhichmaybeprovidedtoyouseparately.
1.17 No tax advice
YouacknowledgethatyouaresolelyresponsibleforacquiringappropriateindependenttaxadviceregardinganytransactionsyouenterintopursuanttoorundertheseTermsofBusinessandthatnothingintheseTermsofBusinessorinanyotherwrittenornon-writtencommunicationbetweenyouandusoranyotherassociatedcompanyconstitutesadvicerelatingtotaxortothesuitabilityfromataxplanningperspectiveofanystrategyorinvestmentortoyourcompliancewithApplicableLaw.
1.18 Governing law
1.18.1 TheseTermsofBusinessandanydisputeorclaimarisingoutoforinconnectionwiththemortheirsubjectmatterorformation(includingnon-contractualdisputesorclaims)shallbegovernedbyandconstruedinaccordancewiththelawsofEnglandandWales.
1.18.2 AnylegalactionorproceedingsarisingoutoforinconnectionwiththeseTermsofBusiness(whetherarisingoutoforinconnectionwithcontractualornon-contractualobligations)(“Proceedings”),shallbedealtwithbythecourtsofEnglandandWalesoranyothercourtintheUnitedKingdomwhichisabletohearthecaseunlessyouresideinacountryintheEuropeanEconomicArea,inwhichcasethesecourtswillhavenon-exclusivejurisdiction(whichmeansthatadisputemaybeheardinthecourtsofthecountryoftheEuropeanEconomicAreainwhichyoulive).
1.19 Assignment and transfer
1.19.1 WemaytransferanyofourrightsorbenefitsandyourliabilityundertheseTermsofBusinesstoanyotherperson,providedthatthiswillnotimpactyourrightsundertheseTermsofBusinessandthetransfereeisofcomparablecapability,reputationandfinancialstandingtous.
1.19.2 WemayarrangeatanytimeforanyotherpersontocarryoutourdutiesundertheseTermsofBusiness,orifwereasonablyconsideritnecessarytocomplywithanyApplicableLaw,totransferourdutiestoanotherCitigroupOrganisationifthetransferdoesnotmateriallyaffecttheservicesweprovidetoyouandthetransfereeisofcomparablecapability,reputationandfinancialstandingtous.Ifwedoso,wewillnotifyyouandthetransferwilltakeeffect14days(oralaterdateifwestatethisinthenotice)aftersuchnotificationunlessyounotifyusofyourobjectioninwritingwithin14days.Oncethetransferhastakeneffect,weshallnolongerhaveanyobligationstoyouinrelationtotheseTermsofBusiness.
PART 2: OUR INVESTMENT SERVICES
2. INVESTMENT SERVICES
2.1 General
2.1.1 ThisPart2setsoutthebasisonwhichCitiwillprovideyouwithInvestmentServices.TheprovisionscontainedinthisPart2applytoallInvestmentProductsunlessotherwisestated.
2.1.2 Ourinvestmentservicesaregenerallyofferedinrelationtothefollowinginvestmentproducts:equities(e.g.shares),depositaryreceipts,unitsinregulatedcollectiveinvestmentschemes,fixedincome(e.g.corporatebondsandgovernmentbonds),andstructuredproducts(e.g.structurednotes).
2.2 Account Relationship Types
2.2.1 WewouldliketodescribetheAccountRelationshipTypesavailabletoyou.ThetypesofproductsandservicesyoumayreceivewithanaccountdependsontheAccountRelationshipTypewhichyouhavewithus.TheAccountRelationshipTypesforwhichyouareeligiblewilldependontheinformationyouchosetoprovideuswithinrelationtoyourpersonalcircumstancesandInvestmentProductcategoryknowledgeandexperience.Generallyspeaking,ifyoureceive,orhavepreviouslyreceived,anyadvicefromus,youhaveanAdvisedAccountRelationshipwithus,andifyoudonotreceive(andhaveneverreceived)anyadvicefromus,youhaveaNon-AdvisedAccountRelationshipwithus.IfyouareunsurewhichAccountRelationshipTypeyouhavewithus,youcancallCition0800005500toconfirm.
2.2.1.1 Advised Account Relationship
2.2.1.1.1 InanAdvisedAccountRelationship,youwillbeabletoreceiveadviceunderourInvestmentAdvisoryServices.Youmayalsobeabletocarryoutnon-advisedtransactionsinrelationtoanumberofInvestmentProducts.YoucanobtaindetailsoftheseInvestmentProductsfromyourRelationshipManager.
2.2.1.1.2 Wewillnotadviseyouaboutthemeritsofaparticulartransactionifwereasonablybelievethat,atthetimeofyourorder,youarenotexpectingsuchadviceandaredealingonanexecution-onlybasis.
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2.2.1.2 Non-Advised Account Relationships (No recommendations, advice or solicitations)
2.2.1.2.1 InaNon-AdvisedAccountRelationship,weprovideyouwithaccesstoaninvestmentplatformsolelytoallowfortheexecutionofnon-advisedorunsolicitedtransactions(pertainingtoamorelimitedrangeofInvestmentProductsthanareavailableinanAdvisedAccountRelationship).Wereceiveafeeinconnectionwiththeexecutionofsuchtransactions.Portfolioreviewsandportfolioassessmentsarenotprovided,giventhenatureoftheaccount.TheclientprofileforaNon-AdvisedAccountRelationship,inadditiontopersonalinformation,willconsistonlyofinformationrelatedtoyourproduct-categoryknowledgeandexperiencesoastoestablishtherangeofInvestmentProductsavailabletoyouwithinyourInvestmentAccount.
2.2.1.2.2 OurNon-AdvisedServicesincludebuyingandsellinginvestmentsforyourInvestmentAccount(andswitchinginvestmentswhereapplicable),solelyinresponsetoyourinstructionsbutsubjectalwaystoanyrestrictionsimposedbytheseTermsofBusinessorApplicableLaw.Onreceiptofyourinstructionswewillarrangeforthepurchaseorsaleofinvestmentsusinganymarket,exchangeorfacilityCiticonsidersappropriate,unlessyouinstructusotherwise.
2.2.1.2.3 YoumaynotbeabletoaccessthefullrangeofCitiInvestmentProductsthroughaNon-AdvisedAccountRelationship.
2.3 Linked accounts
2.3.1 YourInvestmentAccountmustbelinkedtoaBankAccountinthesamename(s).
2.3.2 WhenyouopenanewInvestmentAccount,wewilllinkyournewaccounttoyourexistingBankAccount.IfyouhavemorethanoneBankAccount,wewilllinktotheaccountwhichwenominate.ThisistheaccountfromwhichwewilldeductthepurchasepriceofanyInvestmentProductwhichyoupurchasethroughusaswellasourfeesandcharges.
2.3.3 YoumayaskforyourInvestmentAccounttobelinkedtoadditionalBankAccountsinthesamename(s),ortochangewhichofyouraccountsarelinkedtoyourInvestmentAccount,andwewillaccommodatereasonablerequestswherethisiscompatiblewithoursystems.
2.4 Minimum lump sum investment amounts
2.4.1 Theminimumlumpsumwhichmaybeinvestedis:
2.4.1.1 £1,000perFundifyouinvestinFundsviaCitiOnline;or
2.4.1.2 £10,000(intotal)ifyouinvestinanyotherproductthroughaRelationshipManager.
2.5 Regular investments
2.5.1 RegularinvestmentcontributionscanbemadefromyourBankAccountonly.ThesewillbecollectedfromyourBankAccountonthedateweagreewithyouwhenyousetupyourregularcontributionarrangements.
2.5.2 IfyouestablisharegularinvestmentplantoinvestinFunds,theminimumregularinvestmentamountis£500perFund(regardlessofwhetheryousetupyourregularinvestmentplanviaCitiOnlineorthroughaRelationshipManager).
PART 2A: INVESTMENT ADVISORY SERVICES
ThetermssetoutinthisPart2AapplytoyouonlyifyouhaveanAdvisedAccountRelationshipwithus.
2.6 Investment objectives
2.6.1 BeforeprovidingyouwithourInvestmentAdvisoryService,Citiwillrequireyoutocompleteaninvestmentprofilingform,inwhich,amongstotherthings,youcommunicatetoCitiyourfinancialsituation,investmentobjectives,risktoleranceandknowledgeandexperienceofinvestments.
2.6.2 Youmustcontactusimmediatelyoratthelatestwithin30daysifatanytimeinthefuturethereisamaterialchangetoanyoftheinformationdescribedinclause2.6.1.
2.6.3 Unlessotherwiseagreedandspecifiedintheinvestmentprofilingform,therearenorestrictionsonthetypesofinvestmentinwhichyouwishtoinvest,oronthemarketsonwhichtransactionsmadebyyou,orforyou,aretobeexecuted.
2.7 Advised Account Relationship
2.7.1 AnAdvisedAccountRelationshipexistswhenyouuseourInvestmentAdvisoryServiceinrelationtoyourInvestmentAccount.WereservetherighttorefusetoprovideourInvestmentAdvisoryServiceifwehavereasonablegroundsfordoingso(forexample,wherewedeemthatyouhaveinsufficientknowledgeandexperienceoryouhaveprovidedinsufficientinformationtousorwherewereasonablyconsiderthatprovidingtheInvestmentAdvisoryServicetoyoumayresultinabreachofApplicableLaw).
2.7.2 AspartofourInvestmentAdvisoryServiceyouwillbeabletoreceiveinvestmentadvicefromusonatransaction-by-transactionbasisinrelationtoanumberofInvestmentProducts,aswellasExecutionServicesfortransactionsinrelationtowhichyouhavereceivedinvestmentadvice.Whenweprovideyouwithsuchinvestmentadvice,itwillbe‘restrictedadvice’(asopposedto‘independentadvice’),whichmeansthatwewilladviseandmakearecommendationtoyouthatisbasedon,andtakesintoaccount,arestrictedrangeofInvestmentProducts,orInvestmentProductsfromonecompanyoralimitednumberofcompaniesandwhichmayhavebeenissuedorprovidedbyanotherCitigroupOrganisationoranentitywithcloselegaloreconomiclinkstoaCitigroupOrganisation.OurinvestmentadvicewillnotbebasedonacomprehensiveanalysisofallavailableInvestmentProductswithinagivenproductcategory.AlistofthecompaniesandproductsweofferourInvestmentAdvisoryServiceinrelationtoisavailableonourwebsitewww.citibank.co.ukorsuchotherwebsiteasisnotifiedtoyou.
2.7.3 Wherewe,pursuanttothisclause2.7,provideyouwithadviceinrelationtoafinancialinstrument,wewillassessthesuitabilityoftheinvestment.Thisistoenableustoactinyourbestinterests.Wewillassessthesuitabilityoftheinvestmentonthebasisofinformationyouprovidetousinaccordancewithclauses2.6and2.8.Accordingly,itisimportantthatyouprovideaccurate,up-to-dateandcompleteinformationtous.Incertaincircumstances,forexample,whereyouholdaJointInvestmentAccountorappointapowerofattorneyonyourInvestmentAccount,youacknowledgethatwemayassesstheknowledgeandexperienceoftheotherJointInvestmentAccountHolderoryourattorneyasapplicable,whenassessingthesuitabilityoftheinvestmentforyou.Thatotherpersonmayhaveahigherlevelofknowledgeandexperiencethanyou.Youacknowledgethatthisapproachmayresultinyouholdingfinancialinstrumentsthatweconsidertobesuitableforyoubutwhicharenotnecessarilyalignedwithyourownknowledgeandexperience.
2.7.4 YouwillpayusfortheInvestmentAdvisoryServicethroughourAdvisoryFeewhichissetoutintheKeyFactsDocument.TheAdvisoryFeewillbedeductedfromyourBankAccount,inadditiontothecostofyourInvestmentProduct,atthetimethatyourinvestmentintheInvestmentProductismade.
2.7.5 OurInvestmentAdvisoryServiceinvolvesadvisingyouaboutthemeritsofpurchasingaparticularInvestmentProduct.Unlessotherwiseagreedwithyou,wewillnotadviseyouaboutthemeritsofsellinganyofyourInvestmentProducts.
2.7.6 Thisisnotafiduciaryrelationship.Thismeansthatunlessotherwiseagreedwithyou,wewillnotbeunderanyobligationtoprovideon-goingadviceinrelationtoyourInvestmentProductsorthecompositionofyourinvestmentportfolio.Wewillbeundernoobligationtobringinvestmentopportunitiestoyourattentionortoupdatetheinformationorinvestmentadviceprovidedunlesswehaveagreedinwritingtomaintainyourportfolioundercontinuousreviewandprovidespecificrecommendationsfromtimetotime.
2.7.7 Whereweprovideyouwithinvestmentadviceinrelationtoafinancialinstrumentwewillprovideyouwithasuitabilityletter(the“Suitability Letter”)thatincludesanoutlineoftheadvicegiven,includinghowtheadvicemeetsyourobjectivesandpersonalcircumstances.
2.7.8 ThisSuitabilityLettershouldbeprovidedtoyoupriortothetransactiontowhichtheadvicereflectedintheSuitabilityLetterrelatesunlessitisconcludedusingameansofaDistanceCommunication,whichpreventsthepriordeliveryoftheSuitabilityLetter,inwhichcasewemayprovidetheSuitabilityLettertoyouimmediatelyafterthetransaction,providedthatyouconsenttoreceivingtheSuitabilityLetter
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withoutunduedelayaftertheconclusionofthetransactionandyouaregiventheoptionofdelayingthetransactioninordertoreceivetheSuitabilityLetterinadvanceofthetransaction.
2.7.9 Wearenotobligedtoprovideperiodicportfolioreviews.Wemayprovideperiodicportfolioreviewsorresearchservicesonanadhocbasisatyourrequest.Anyperiodicportfolioreviewsand/orresearchservicesrequestedbyyouwillnotbeprovidedtoyouunless(a)itisrequiredbyApplicableLaw;or(b)wehavespecificallyagreedwithyouinwritingtoprovidesuchservice.
2.7.10 Intheeventthatwedoprovideanon-goingadviceserviceasdescribedinclauses2.7.6and2.7.9,wemaychargeanongoingfeepayablebyyouassetoutintheKeyFactsDocumentandtheInvestmentCostsandChargesIllustration.
2.7.11 Withoutprejudicetoclauses2.7.6,2.7.9and2.10inAdvisedAccountRelationships,wemay:
2.7.11.1 atourdiscretion,performregularorperiodicrisk-basedassessmentsoftransactionsoraccounts;and
2.7.11.2 asaresultoftheseassessments,suggesttoyouthatyoushouldnotexecuteagiventransaction.
2.7.12 Whereweprovideinformation,adviceorrecommendationsongeneralmarketconditions(asopposedtoinvestmentadviceorpersonalrecommendationsinrelationtoaparticularInvestmentProduct),wegivenorepresentation,warrantyorguaranteeastotheaccuracy,suitabilityorcompletenessoftheinformation,adviceorrecommendationsorastothetaxconsequencesofanytransaction.Wewillnotbeliableinrelationtosuchinformation,adviceorrecommendationsongeneralmarketconditionsexceptwherewehavebeennegligentinprovidingthemtoyou.
2.7.13 Unlesswespecificallyagreeotherwiseinwritingtoyou,youherebyacknowledgethat:
2.7.13.1 theadvicereferredtoinclause2.7.12aboveisprovidedsolelytoenableyoutomakeyourowninvestmentdecisions.Youwillbesolelyresponsibleforanyinvestmentdecisionsyoumakebasedoninformation,orguidanceprovidedbyus;and
2.7.13.2 anyguidancefromusdoesnotimplyanyendorsementorguarantee.
2.7.14 IfyouwanttomakeaTransactionAgainstAdvice,Citimayagreetoexecute(orarrangetohaveexecuted)yourorderevenifitiscontrarytoCiti’sadviceandunsuitableforyourneedsandwillinformyouthatthetransactionwillbeaTransactionAgainstAdvice.BeforeaTransactionAgainstAdviceisexecuted(orarrangedtobeexecuted)byCitiyouwillberequiredtosignaninvestmentexecutiondeclaration(orsuchotherwrittenconfirmationasCitimayrequirefromtimetotime)asevidencethatyouunderstandthatthetransactionisbeingmadeagainstadvicefromCiti.
2.7.15 Citiretainstherighttorefusetoexecute(orarrangetohaveexecuted)atransactionrequestedbyyouifwereasonablydeemthatyouhaveinsufficientknowledgeandexperiencetoclearlyunderstandtherisksassociatedwiththeproposedtransaction.Wewilltellyouassoonasreasonablypracticableintheeventthatwerefusetoexecute(orarrangetohaveexecuted)atransactionrequestedbyyou.
2.7.16 Termination of an on-going advice service: Youmaycancelanyon-goingadviceservice(describedinthisclause2.7)atanytimebygivingusnoticeinwriting,and/orselectinganalternativeinvestmentservice,and/orterminationoftheseTermsofBusinessinaccordancewithclause1.5.Feesmaycontinuetobepayableforotherservicesprovidedtoyou.
2.8 Your obligation to provide information
2.8.1 InorderforCititobeabletoprovideitsInvestmentAdvisoryServicestoyou,Citimayrequireyoutoprovideinformationrelatingtoyou,yourpersonalcircumstances(includingfinancialsituation),investmentobjectives,risktoleranceandyourknowledgeandexperienceofInvestmentProductsinorderforCititocomplywithourobligationsunderApplicableLaw.IfyoufailtoprovideCitiwithsuchinformationaswerequirefromyou,orifwebelievethattheinformationyouhaveprovidedisoutofdate,inaccurateorincomplete,CitiwillnotberequiredtoprovideyouwithitsInvestmentAdvisoryServicesundertheseTermsofBusiness.
2.8.2 WhereweprovideourInvestmentAdvisoryServicestoyou:
2.8.2.1 itwillbeyourresponsibilitytoupdatetheinformationwhichyouprovidetous.Inparticular,youmustcontactusimmediatelyoratthelatestwithin30daysifthereisamaterialchangetoanyoftheinformationyouhavepreviouslyprovidedtousinrelationtoyourprofile,includingtheinformationreferredtoinclause2.8.1;
2.8.2.2 youshouldreadallmaterials,disclosuresandconfirmationstatementsandonlyinvestinproductsandsigndocumentsthatyoufullyunderstand.Ifanypointsareunclear,oryouhaveanyquestionspleasecontactyourRelationshipManager.Althoughyoumaymakeinvestmentdecisionsbasedonguidanceorrecommendationsprovidedbyus,thedecisiontoproceedwiththeinvestmentissolelyyours;and
2.8.2.3 exceptwherewehavebeennegligentorfraudulentorinwilfuldefault,weshallhavenoresponsibilitytoyouifanyinformationweholdaboutyouisorbecomesinaccurateorincomplete,andthishasanadverseeffectonthequalityoftheserviceprovidedbyCiti.
2.9 Investment Advisory Services in relation to Joint Investment Accounts
2.9.1 ItmaybepossibleforyoutoholdcertainInvestmentProductsjointlywithanotherpersoninaJointInvestmentAccount.InordertobeabletoprovidetheInvestmentServicetobothJointInvestmentAccountHolders,CitimayrequireeachJointInvestmentAccountHoldertoprovideuswithinformationrelatingtotheirpersonalcircumstances(includingfinancialsituation)investmentobjectives,risktoleranceandknowledgeandexperience.
2.9.2 AspartoftheapplicationforanInvestmentAccountorafinancialreview,CitiwillgenerallyasktheJointInvestmentAccountHolderstoconfirmbetweenthemwhichInvestmentAccountHolder’sfinancialsituation,investmentobjectivesandrisktoleranceshouldbeassignedtotheJointInvestmentAccount.ThisInvestmentAccountHolderwillbenominatedastheprimaryinvestorandCiti’sInvestmentAdvisoryServicewillbeprovidedinaccordancewiththeprimaryinvestor’sfinancialsituation,investmentobjectivesandrisktolerance.Theprimaryinvestor’sfinancialsituation,investmentobjectivesandrisktolerancemaybedifferentfromthatofthesecondaryInvestmentAccountHolderandthismayimpactthetypesofInvestmentProductsandservicesthattheJointInvestmentAccountHoldersmayhaveaccessto.JointInvestmentAccountHoldersmaychangetheInvestmentAccountHolderthatisnominatedastheprimaryinvestorbycontactingtheirRelationshipManager.
2.9.3 UnlesseachJointInvestmentAccountHolderhasinstructedusinanInvestmentAccountapplicationtoacceptonlyinstructionssignedbyallJointInvestmentAccountHolders,eachJointInvestmentAccountHolderhassufficientauthorityindividuallyto:
2.9.3.1 giveinstructionsofanykind,providedthat,iftheinstructionistopurchaseorsubscribeforaparticularInvestmentProduct,therelevantJointInvestmentAccountHolderhasproductspecificknowledgeandexperienceinrelationtotheproposedInvestmentProduct;
2.9.3.2 makedepositsorwithdrawals;
2.9.3.3 receivepayments,noticesordemands;
2.9.3.4 appointthirdpartiestooperatetheInvestmentAccount;
2.9.3.5 signanydocumentsoragreements;and
2.9.3.6 actontheirowninanyotherwayconcerningtheInvestmentAccountandtheseTermsofBusiness,andwemayrelyfullyonsuchindividualauthority.
2.9.4 YouagreethateachJointInvestmentAccountHolderwillbeindividuallyaswellasjointlyresponsibleforanyamountwhichmaybeduetousundertheseTermsofBusiness.Thismeansthatwecantakeactionagainstoneormore,orallJointInvestmentAccountHolders,regardlessofwhichJointInvestmentAccountHolderwasresponsiblefortheamountbecomingdue.
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PART 2B: NON-ADVISED SERVICES
ThetermssetoutinthisPart2BapplytoyouonlyifyouhaveaNon-AdvisedAccountRelationshipwithus.
2.10 Non-Advised Services
2.10.1 OurNon-AdvisedServicesinvolveExecutionServicesfornon-advisedtransactions.
2.10.2 WhenweprovideNon-AdvisedServiceswewillnotprovideyouwithanyinvestmentadvice.Priortogivingusyourinstructions,youshouldreadallrelevantdocumentation(includingbutnotlimitedto,forexample,prospectusesandofferdocuments),makeanyindependentenquiriesandtakeanytaxorlegaladvicewhichyouconsidernecessarytomakeyourdecisiontoinvest.TheentryorexitofatransactionaspartoftheNon-AdvisedServicesisentirelyyourowndecision,andisnotbaseduponanyadviceorpersonalrecommendationmadebyusoranyotherparty.
PART 2C: FURTHER TERMS APPLICABLE TO INVESTMENT SERVICES FOR ALL RELATIONSHIP TYPES
ThetermssetoutinthisPart2CapplytoyouregardlessofyourAccountRelationshipType.
2.11 Your knowledge and experienceRegardlessofyourAccountRelationshipType,Citiretainstherighttorefusetoexecute(orarrangetohaveexecuted)atransactionrequestedbyyouifwedeemthatyouhaveinsufficientknowledgeandexperience(orhaveprovidedinsufficientinformationforustobeabletodetermineyourknowledgeandexperiencewithrespecttothetransaction)toclearlyunderstandtherisksassociatedwiththeproposedtransaction.
2.12 Joint Investment Accounts
2.12.1 ItmaybepossibleforyoutoholdcertainInvestmentProductsjointlywithanotherpersoninaJointInvestmentAccount.InorderforCititobeabletoprovidetheInvestmentServicetoyouinthisway,wemayrequireeachJointInvestmentAccountHoldertoprovideuswithinformationrelatingtothem.
2.12.2 TotheextentwearenotprovidedwithinformationrelatingtoaJointInvestmentAccountHolder’sknowledgeandexperience,thatJointInvestmentAccountHoldermaynotbeentitledtoreceiveanyInvestmentServices.
2.13 Investment Account statements
2.13.1 MonthlystatementsofthecontentsandvaluationofyourInvestmentAccountwillbeprovided(eitherbypostorwhereyouhaveconsentedforustodoso,throughCitiOnline)aspartofyourconsolidatedstatementcoveringallofyourbankingandinvestmentactivitieswithCiti(includingyourinvestments,anyclientmoneyandnon-cashassetsinourcustody).ThesestatementswillincludestatementsofincomeorotherbenefitsreceivedforyourInvestmentAccountanddetailsofthetransactionsthathavetakenplaceduringtherelevantperiod.Youshouldreviewthesestatementsonceyoureceivethemandinformusofanyinaccuraciesassoonaspossible.IfyouhaveaJointInvestmentAccount,thestatementsandvaluationswillbesenttotheprimaryInvestmentAccountHolderoftheJointInvestmentAccount.
2.13.2 Youmayrequestthatanadditionalone-offvaluationbesenttoyou.ThismayattractareasonablefeeatCiti’sdiscretiontocoverthecostofprovidingtheone-offvaluation.Valuationswillbebasedonthemarketvalueofthesecuritiesinquestionor,wheresuchmarketvalueisnotavailable,onCiti’sestimateofthemarketvalue(whichwillbeonabesteffortsbasis).
2.13.3 InrelationtosomeInvestmentProducts,whereyouconsenttousdoingso,CitimayalsoprovideormakeavailablevaluationsthroughCitiOnline.Youmayalsobeabletoaccessyourvaluationsthroughathirdpartyonlineportal.Wherethisapplies,theoptiontoaccessthethirdpartyonlineportalwillbeclearlysetoutintherelevantInvestmentProductTerms.
2.13.4 IfanInvestmentProductisshownataparticularvalueonyourstatement,thisdoesnotnecessarilymeanthatthesameamountcanberealisedifyoudecidetoliquidatethatInvestmentProduct.AstatementmayincludeInvestment
Productsvaluedatzerobecauseafairmarketpriceisnotavailable.Thismaybebecauseofasuspensionofthelistingoftheassets,defaultbytheissuerorotherreasons.Theabsenceofamarketpriceislikelytobeindicativeofalackofliquidity.
2.14 Client money
2.14.1 Schedule3containstheprovisionswhichgovernhowCitireceivesandholdsmoney.IfathirdpartyCustodianholdsclientmoney,thethirdpartyCustodianissubjecttotheApplicableLawintermsofholdingmoney,anditstermsofbusinesswithyouwillsetoutprovisionswhichgovernhowthethirdpartyCustodianreceivesandholdsclientmoney.
2.14.2 Theonlycircumstanceinwhichwewillholdmoneyforyouastrusteeissetoutbelowat2.14.2.1,inwhichcaseifwefailtheclientmoneydistributionandtransferruleswouldapply.
2.14.2.1 Wherewechoosetoholdanamountofourmoneytocoverashortfall(assuchtermisusedintheFCARules),wewillholdthatamountforyouinaccordancewiththeFCARulesonclientmoney(“Cover Amount”)untiltheshortfallisresolved(unlessotherwiseagreed),andinsuchcasesthetermssetoutinparagraphs(i)to(v)shallapply.Wheretherelevantshortfallreducesorisotherwiseresolved,theCoverAmount(ortheportionthereofinexcessoftherelevantshortfall)shallbecomeimmediatelydueandpayabletous.IntheeventofterminationofthisAgreement,wewilltreatpaymenttoyouofsuchmoneycoveringashortfallasfullydischargingourobligationtoreturnthesecuritieswhichwerethesubjectofthatshortfalltoyou.
(i)Wemaytransferclientmoneytobeheldbyathirdparty(the“Third Party”).ExceptasprovidedforinthisAgreement,weacceptnoliabilityfortheactsoromissionsoftheThirdParty.IntheeventoftheinsolvencyoranalogousproceedingsoftheThirdParty,themoneyreceivedbyusfromtheThirdPartymaybeinsufficienttosatisfyyourclaim.
(ii)WemayarrangeforclientmoneytobeheldoutsidetheUK.SuchmoneymaybeheldinaccountswiththeThirdPartyinastatewhichisnotanEEAstateand,insuchcase,therelevantaccountswillbesubjecttothelawsofthatstateandtheclientmoneymaybetreatedinadifferentmannerfromthatwhichwouldapplyiftheclientmoneywereheldbyapersonlocatedintheEEA.
(iii)WhereclientmoneyisdepositedintoanaccountwiththeThirdParty,suchThirdPartymayhavesecurityinterestorlienover,orrightofset-offinrelationto,suchmoney,totheextentwearepermittedtograntsuchrightsbytheFCARulesonclientmoney.
(iv)AnyinterestreceivedbyusinrespectofclientmoneyshallberetainedbyusandshallnotbecreditedtoyourAccount.
(v)Wemaytransferyourclientmoneytoanaffiliateortoathirdpartyaspartofasaleortransferofallorpartofourbusiness,wherethatclientmoneyrelatestothebusinessbeingtransferred.Insuchacase,eitherthesumstransferredwillbeheldforyoubythethirdpartytowhomtheyaretransferredinaccordancewiththeFCARulesonclientmoney,orifthesumswillnotbeheldinaccordancewiththeFCARulesonclientmoney,wewillexercisealldueskill,careanddiligenceinassessingwhetherthatthirdpartytowhomclientmoneyistransferredwillapplyadequatemeasurestoprotectthesesums.
2.15 Delegation
2.15.1 Citimay,fromtimetotime,arrangeforanyoftheservicescontemplatedundertheseTermsofBusinesstobecarriedoutbyathirdparty.Atalltimes,CitiwilldothisincompliancewiththeApplicableLaw.
2.15.2 Whenenteringintoanyagreementorarrangementwithathirdparty,thethirdpartymayactasCiti’sagent,orCitimayenterintosucharrangementswiththethirdpartysuchthattheybecomeyouragent(sothatthereisadirectrelationshipbetweenyouandthethirdpartyserviceprovider).ByacceptingtheseTermsofBusiness,youauthoriseustoenterintosucharrangementsasyouragent.
2.16 Investment information
2.16.1 Unlessyouhaveinstructedusnotto,youagreethatCitimayprovideyou,fromtimetotime,withgeneralorspecificinformationbysendinglettersorcircularsorbycontactingyouatanyaddressortelephonenumberprovidedbyyou,inrespectofanyofthetypesofinvestmentlistedbelow:
2.16.1.1 cashaccountsortimedeposits;
2.16.1.2 sharesorotherformsofequityincompanies,anddebtinstrumentsissuedbygovernments,stateagencies,companies,utilitiesandotherissuersincludingissuesoroffersforsalethatareunderwritten,managedorarrangedbyaCitigroupOrganisation;
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2.16.1.3 foreignexchangecontractsforspotorfuturesettlementorothercurrencyInvestmentProducts;
2.16.1.4 commodities;
2.16.1.5 options,warrants,depositaryreceipts,futurescontracts;orothertypesofinstrumentrelatingtotheabovetypesofinvestmentortostockindexes,interestratesorotherinvestmentsorchangesintheirvalueorrelativevalue;and
2.16.1.6 unittrusts,funds,includingthosewhichmaybeoperated,managedoradvisedbyaCitigroupOrganisation.
2.17 Power of attorney (agent or proxy-holder)
2.17.1 WhereyouuseourInvestmentServicesandyoulegallyappointathirdpartytoactonyourbehalfinrelationtothoseInvestmentServices,CitiwillrequiresuchindividualtoprovideuswithinformationrelatingtotheirknowledgeandexperienceinorderforustoprovidetheInvestmentServices.
2.17.2 Ifwereasonablybelievethatthethirdparty’slevelofknowledgeandexperienceislowerthanthatoftheInvestmentAccountHolder(ortheprimaryinvestorinthecaseofJointInvestmentAccounts),orisoutofdate,inaccurateorincomplete,CitiwillnotberequiredtoprocessanytransactionauthorisedbythethirdpartyonyourbehalfinrelationtoInvestmentProductsundertheseTermsofBusiness.Citiwilltellyou(orthethirdpartyappointedtoactonyourbehalf)ifthisisthecase.
EXECUTION SERVICES
2.18 Investment instructions
2.18.1 Youagreethat:
2.18.1.1 eachorderyouplaceisbasedonyourowninitiativeandfinancialjudgement,whetherornotyoubasethoseordersoninformationoradviceprovidedthroughourInvestmentAdvisoryServices;
2.18.1.2 exceptwheretherehasbeennegligence,fraud,fraudulentmisrepresentationorwilfuldefaultonthepartofCitiorathirdparty(forexample,athirdpartyCustodian),youacceptfullresponsibilityforallrisksandlossesassociatedwiththeordersplaced,whetherornotyoubasethoseordersoninformationoradviceprovidedbyCitithroughourInvestmentAdvisoryServices;
2.18.1.3 purchaseorsaleinstructionsforInvestmentProductsaresubjecttoallapplicablemarketrulesandregulationsandApplicableLaw;and
2.18.1.4 CitiwillnotexecuteorderstobuyInvestmentProductsorarrangeforsuchorderstobeexecutedunlessyouhold,oryouhavearrangedforCititohold,thenecessaryfundsintheBankAccount(s)linkedtoyourInvestmentAccountinaccordancewithclause2.3.
2.18.2 WhereCitiisactingasCustodian:
2.18.2.1 iftheInvestmentProductsyouwishtosellarenotheldbyCitiforyouortheInvestmentProductshavenotbeenreceivedbyCitioritsagents,Citimayrefusetoexecuteasaleorarrangeforasaletobeexecuted;
2.18.2.2 ifanyInvestmentProductCitisellsforyouisdefectiveorisnotdeliveredintimeforreasonsbeyondCiti’sreasonablecontrol,Citimayrepurchaseitatyourexpense;and
2.18.2.3 ifatransactionwouldresultinafractionalshare,wewilladjustthesizeofthetransactiontobringtheholdingdowntothenearestwholenumberofsharesandpaythedifferenceincashintoyourAccount.
2.18.3 WhereathirdpartyisactingasCustodian:
2.18.3.1 iftheInvestmentProductsyouwishtosellarenotheldbythatthirdpartyforyouortheInvestmentProductshavenotbeenreceivedbythem,theymayrefusetoexecuteasaleorarrangeforasaletobeexecuted;and
2.18.3.2 ifanyInvestmentProductathirdpartysellsforyouisdefectiveorisnotdeliveredintimeforreasonsbeyondthatthirdparty’sreasonablecontrol,thatthirdpartymayrepurchaseitatyourexpense.
2.18.4 WherewehavearrangedforathirdpartytoactasyourCustodian,youshouldstillprovideinstructionstoCitiwhowillactasyouragentinpassingyourinstructionstothethirdpartyCustodianandfromthemtoyou;Citiwillstillprovideyouwithanorderconfirmation.
2.18.5 Youcangivewritteninstructionstousinthefollowingways:
2.18.5.1 bysubmittingyourinstructionsonlineusingCitiOnline;or
2.18.5.2 bypostingyourinstructionstothefollowingaddress:
CitibankUKLimited InvestmentOperations POBox4012 Swindon,SN44JZ
2.18.6 Youcanalsogiveinstructionstousbytelephone,bypriorarrangement.
2.18.7 YoumayalsogivewritteninstructionsbyemailtoyourRelationshipManagerbypriorarrangement.Pleasenotethatifinstructionsforasubscriptionareemailed,thismustbeanemailofafullycompletedapplicationform.
2.18.8 YouauthoriseCititoacceptanyinstructionbymail,email,telephoneorthroughCitiOnlinewithoutfurtherauthenticationorconfirmation.However,wemaytakestepstoverifyaninstructionassetoutinclause2.18.10belowandyouagreethatCitishallnotberesponsiblefor,andthatyouwillcompensateCitifor,anyreasonablyincurredlosses,includinglegalfees,whichresultfromCitiactingorrefusingtoactoninstructionsreceivedbymail,email,telephoneorthroughCitiOnline.
2.18.9 Yourinstructionsmustbeclearandaccurate.Iftheyarenot,wewillnotbeliableifyourinstructionsarerejectedorperformedincorrectly,exceptinthecircumstancessetoutintheseTermsofBusiness.
2.18.10 Beforeweactinrelationtoaninstruction,wemaycarryoutchecksdesignedtoensurethatwebelievetheinstructionhascomefromyouandisclear.Wewilltreataninstructionasbeingmadebyyouifwereasonablybelievethesignaturetobeyours(whereapplicable)orifwearesatisfiedthatyouarewhoyousayyouare(forexample,byverifyingsecuritydetailsthatweusetoidentifyyouorbyprovidingadditionalidentificationdocuments).
2.18.11 Wemayrefusetoactinrelationtoyourinstructionsif:
2.18.11.1 wereasonablysuspectfraudulentorothercriminalactivity;
2.18.11.2 wereasonablybelievethatbyactinginrelationtotheinstructionwemightbreakanyApplicableLaw;or
2.18.11.3 wedonotreasonablybelievethesignaturetobeyours(whereapplicable)orwearenotsatisfiedthatyouarewhoyousayyouare(followinganappropriatevalidationprocess).
2.18.12 WhereCitiexecutesorarrangestheexecutionofatransactionforyou,wewilldosoinaccordancewithourBestExecutionPolicy(asummaryofwhichisprovidedinSchedule5oftheseTermsofBusiness).WhereathirdpartyCustodianexecutesorarrangesexecutiononyourbehalf,thatthirdpartyCustodian’sownbestexecutionpolicywillapplyinstead.
2.18.13 You should read the Best Execution Policy summary carefully as we will treat you as having consented to the Best Execution Policy if we receive an order from you or execute transactions with or for you.
2.18.14 The Best Execution Policy provides for the possibility that client orders may be executed outside a Trading Venue. However, we are unable to execute any of your orders outside a Trading Venue unless we have received your express consent to do so.
2.18.15 In addition, any specific instructions you give to us may prevent us from taking the steps that we have designed and implemented as part of our Best Execution Policy to take all sufficient steps to obtain the best possible result for the execution of those orders in respect of the elements covered by those instructions.
2.18.16 AtthetimeyouenterintotheseTermsofBusinessandeverytimeyouplaceanorderwithustoenterintoanytransaction,youwillbedeemedtomaketherepresentationssetoutinSchedule6,sopleasereadthesestatementscarefullyandensurethatyouarehappytomakethem.
2.18.17 YoushouldnotenterintoatransactiontopurchaseanyInvestmentProduct(includingwherethisisheldwithinaPlan)withoutfirstcarefullyreadingtheInvestmentProductTermsapplicabletotheproduct,theseTermsofBusiness,therepresentationsinSchedule6,theyKeyFactsDocument,andtheInvestmentCostsandChargesIllustrationwhichsetsouttheapplicablefeesandchargesfortheInvestmentProducts.Weintendtorelyonallsuchdocumentssoyoushouldneverenterintoanytransactionifyoudonotunderstandanythingorifyouhaveanyquestions.Ifyoudohaveanyquestions,pleasecontactCition0800005500(oryourRelationshipManager,ifyouhaveanAdvisedAccountRelationship)beforeproceeding.
2.18.18 Whenyouinstructustoexecuteorarrangefortheexecutionofanytransactionforyou,youauthoriseustodeductthepurchasepriceandanyapplicablefeesandchargesfromtheBankAccount(s)linkedtoyourInvestmentAccountinaccordancewithclause2.3.
2.19 Confirmations
2.19.1 Subjecttoclause2.19.2,inrelationtoeachInvestmentProducttransactionwecarryoutonyourbehalf,wewillsendyouawrittenconfirmationassoonaspossibleandnolaterthanthefirstBusinessDayfollowingthatexecution.
2.19.2 InrelationtoanyregularFundinvestmentplantransaction
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carriedoutonyourbehalfbyCitiorathirdpartyCustodian,youherebyinstructCititosendyouaninitialinstructionconfirmationinrespectofexecutionofthefirsttransaction,followedbymonthlystatementsdetailingsubsequenttransactions.
2.19.3 YoushouldreviewthetradeconfirmationsthatCitisendsyouandnotifyCitipromptlyofanydiscrepancies.
2.19.4 Youarenotrequiredtoacknowledgeorconfirmthetradeconfirmationbutifyoudisagreewiththetransactiondescribedinthetradeconfirmation,pleasecontactusassoonaspossible.
2.20 Dealing; selection of brokers, agents and other counterparties
2.20.1 WhereanorderiscarriedoutbyCitionyourbehalf:
2.20.1.1 itwillbeexecutedsubjectatalltimestoApplicableLaw;and
2.20.1.2 youauthoriseustoenter,onyourbehalf,intoanynecessarydealingtermswithotherbrokers.
2.20.2 WhereCitiactsforyou:
2.20.2.1 whereatransactiondoesnotsettleontheduedateforsettlement,wemay,inourabsolutediscretion,provisionallycreditand/ordebit(asapplicable)yourInvestmentAccountand/orBankAccountonsuchduedateforsettlementasifthetransactionhadsettledonthatdate.Wemay,however,atanytimeinourabsolutediscretionreverseanysuchprovisionaldebitsandcredits;
2.20.2.2 withoutprejudicetothediscretionwemayexerciseinaccordancewithclause2.20.2.1above,deliveryorpayment(asthecasemaybe)bytheotherpartytothetransactionshallbeentirelyatyourriskandCiti’sobligationstodeliverInvestmentProductsortheproceedsofthesaleofInvestmentProductstoyoushallbeconditionaluponreceiptbyCitiofdeliverabledocumentsorsaleproceeds(asthecasemaybe)fromtheotherpartyorpartiestothetransaction;
2.20.2.3 anycashreceivedbyCitiinrespectofatransactionshallbeadebtowedbyCititoyouuntilpaidbyCititoyouorotherwisedischarged;
2.20.2.4 ifyouhavenotprovidedtherelevantfundstoCitiforatransaction,Citimaysettleyourobligationsunderthattransaction.InthosecircumstancesyoushallpayCitiassoonaspossible;
2.20.2.5 subjecttotheApplicableLaw,youauthoriseCititodealforyouraccountthroughbrokers,dealers,agents,exchangesandothercounterpartiesinaccordancewithCiti’snormalpractice.WhilstCitiwillexercisereasonableskill,careanddiligenceintheselection,appointmentandperiodicreviewofitscounterparties,agents,sub-custodians,depositariesandclearingsystems(anyofwhichmaybeamemberoftheCitigroupOrganisation),youacceptthatanytransactionorpropertyplacedwithanysuchdelegateofCitiwillbeatyoursoleriskandCitishallnotbeliableforyouractsoromissionsorforanylossordamagesufferedbyyouexceptintheeventofourfraud,negligence,wilfuldefaultorbreachoftheApplicableLaw;
2.20.2.6 youagreethatCitimayplacealloranypartofyourInvestmentProductwithanyclearingsystemand/orinanomineename;and
2.20.2.7 CitimaycombineyourorderswithCiti’sownordersandordersofanyCitigroupOrganisationorotherclientswhereitisunlikelythattheaggregationoforderswillworkoveralltothedisadvantageofanyclientwhoseorderistobeaggregated.Pleasenotethattheeffectofaggregationmayworktoyourdisadvantageinrelationtoaparticularorder(forexample,butnotlimitedto,intermsofpriceorvalue).
2.20.2.8 Wherewehavereceived,orsubsequentlyreceive,anexpressinstructionfromyouofthefollowing(whichmaybegivenasastandinginstruction)inrespectofagreementstoexecuteaLimitOrderinrespectofsharesadmittedtotradingonaRegulatedMarket,ortradedonaTradingVenue,weshallnotbeobligedtopublishaLimitOrderimmediatelyifitcannotbeimmediatelyexecutedunderprevailingmarketconditions(unlessinstructedotherwisebyyouinwritinginrespectofaparticularLimitOrderandweacceptthatLimitOrder).
2.21 Custody arrangements
2.21.1 UnlessotherwisestatedintheInvestmentProductTermsofBusinessoradvisedbyyourRelationshipManagerallInvestmentProductsboughtforyoubyCitipursuanttotheseTermsofBusinesswillbesubjecttoCiti’sCustodyServicesasdetailedinclause2.22.
2.21.2 Please note that Citi does not currently offer Custody Services in relation to all Investment Products.IfyoupurchaseanInvestmentProductforwhichCitidoesnot,orelectsnotto,provideCustodyServices,youwillberequiredtoenterintoaseparateagreementwithathirdpartyCustodian.Inthatcasethetermsofthatseparateagreementwillgovernthecustodyarrangementsinrelationtoyourinvestment.
2.21.3 WhereCitiprovidesyouwithCustodyServicesthebasisonwhichaCustodianwillprovidecustodyofyourAssetsissetoutinclause2.22.WhereCitiisnotactingasCustodianwewillappointathirdpartyCustodianonyourbehalf,assetoutinclause2.24.
2.21.4 WewillchargeyouourGlobalCustodyFee(regardlessofwhetherCitiorathirdpartyCustodianactsasyourCustodian).DetailsofwhattheGlobalCustodyFeecoversandhowitiscalculatedaresetoutintheKeyFactsDocument.TheGlobalCustodyFeewillbedeductedfromtheBankAccount(s)linkedtoyourInvestmentAccountinaccordancewithclause2.3.
2.21.5 YoucanrequestastatementoftheAssetsheldforyouatanytime.
2.22 Citi’s Custody Services
2.22.1 InrelationtoInvestmentProductsforwhichCitiprovidesCustodyServices,youagreethatCitimayactascustodianforyouandyouherebyappointCiti,witheffectfromthedateyouopenanInvestmentAccount,toactasyourcustodianinrespectofsuchInvestmentProducts.
2.22.2 YouauthorisetheCustodiantoestablishonitsbooksoranysub-custodian’sbooksastheCustodianmaydecide:
2.22.2.1 acustodyaccountoraccounts(the“Custody Account”)forthedepositofInvestmentProducts(otherthancash)fromtimetotimereceivedbytheCustodianforyourInvestmentAccount,theCustodyAccounttobedesignatedtoshowsuchInvestmentProductsbelongingtoyouaresegregatedfromtheCustodian’soritsappointedsub-custodian’sownassets;and
2.22.2.2 acashaccountoraccountsdesignatedinyournameforthedepositofcasharisingoutof,orinconnectionwith,anyInvestmentProductintheCustodyAccount.
2.22.3 YouagreethattheCustodyServicesassetoutinthisclause2.22shallbeperformedbytheCustodian.YouagreethattheCustodianmayregisterorrecordlegaltitletoanyInvestmentProductinthenameofitsnomineecompanyoranomineecompanycontrolledbytheCustodian’ssub-custodianoragent.Insuchcircumstances‘beneficial’titletotheInvestmentProductwillremainwithyou:thismeansthatthenomineewouldbetreatedastheholderoftheInvestmentProductbytheproductproviderbutthenomineewillpassbenefitsontoyou.YoushalltakeanysuchactionwhichmaybenecessaryandexecutesuchdocumentsandprovidesuchmaterialsandinformationasmaybereasonablyrequestedbytheCustodiantoenabletheCustodianorsuchagentorsub-custodiantoperformitsdutiesandobligationsunderthisclause2.22,includingparticipationinanyrelevantclearingsystem.YouwillnotifyCitiassoonasyoubecomeawareofanyinaccuracyinsuchmaterialsorinformation.
2.22.4 YouauthorisetheCustodianto:
2.22.4.1 poolyourInvestmentProductswiththosebelongingtootherclientsoftheCustodian;
2.22.4.2 openandoperateforeigncurrencyaccountsforyou;
2.22.4.3 safe-keepyourInvestmentProductseitherintheCustodian’sownoritssub-custodian’scustodyintheUKor,subjecttotheApplicableLaw,inanyothercountry,subjecttothelaws,regulationsandcustomsoftheplacewheretheyarekeptandalso,whererelevant,totheApplicableLaw;
2.22.4.4 useanypersonselectedbytheCustodianasasub-custodiantocarryouttheCustodyServices,including(whereCitiistheCustodian)otherCitigroupOrganisationsandthirdparties;
2.22.4.5 wheretheCustodianholdsregistrableInvestmentProductsforyou,registerandrecordsuchInvestmentProductsinyournameorinthenameofaneligiblenomineeincompliancewiththeApplicableLaw;and
2.22.4.6 wheretheCustodianholdsregistrableInvestmentProductsforyouwhicharesubjecttothelawormarketpracticeoutsidetheUKandtheCustodianispreventedfromregisteringorrecordinglegaltitleinthewaysetoutin2.22.4.5above,registerorrecordsuchInvestmentProductsinthenameofathirdpartyor,iftheCustodianispreventedfromdoingso,initsownname,andineithercaseincompliancewiththeApplicableLaw.
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2.22.5 You are hereby notified that if Investment Products are registered or recorded in the name of the Custodian (in accordance with clause 2.22.4.6), such Investment Products may not be segregated from the Custodian’s Investment Products and in the event of the insolvency of the Custodian, your Investment Products may not be as well protected from claims made on behalf of the general creditors of the Custodian.
2.22.6 NotwithstandinganyothertermsoftheseTermsofBusiness,CitishallberesponsiblefortheactsoromissionsofanynomineecontrolledbyCitiorbyaCitigroupOrganisationtothesameextentasCitiisliableforitsownactsandomissions.Citishallbeliabletoyouforlossesinrespectofanysuchnomineearisingdirectlyfromthefraud,negligenceorwilfuldefaultofCiti(butnotforanylossofprofitoropportunity,oranycoststhatareindirectlycausedbytheeventthatledtoanyclaimbyyou,ordamagetoyourreputation).CitiisnotresponsiblewhereitisnotactingasCustodian.Insuchcircumstances,thethirdpartyCustodianwillberesponsibletoyouandtheextentoftheirresponsibilitytoyouwillbesetoutintheirtermsofbusinesswithyou.
2.22.7 UnderarrangementswhereCitiistheCustodian,CitihasrightsagainsttheissueroftheInvestmentProducts(or,whereholdingthroughasub-custodian,therelevantsub-custodianhasrightsagainsttheissueroftheInvestmentProducts)inrespectofallInvestmentProductsheldinyourCustodyAccount,andholdssuchrightsforyourbenefit.
2.22.8 Pursuant to your authorisation in clause 2.22.4 above, the Custodian, and any sub-custodian, may pool your Investment Products. By pooling your Investment Products with those of other clients, your individual client entitlements may not be identifiable by separate certificates, other physical documents of title or equivalent electronic record and therefore, in the event of an irreconcilable shortfall after the insolvency of the Custodian or any appointed sub-custodian, you may share in that shortfall in proportion to your original share of the assets in the pool. Any entitlements or other benefits arising in respect of pooled assets will be allocated in proportion to their assets to each client whose assets are so pooled. The consequences of such pooling are at your own risk.
2.22.9 WhereyourInvestmentProductsareheldoutsideoftheUK,differentsettlement,legalandregulatoryrequirements,anddifferentpracticesrelatingtothesegregationandseparateidentificationofthoseInvestmentProducts,mayapply.
2.22.10 WrittenstatementsofyourInvestmentProductsinCiti’scustodywillbesenttoyoumonthlyaspartoftheInvestmentAccountstatementsdetailedinclause2.13.ThevalueshownonthestatementsoftheInvestmentProductswillbebasedonpricesobtainedbyCitifromvaluationsystemsandotherpricingservices,whichCiticonsidersappropriate.WhereathirdpartyCustodianisactingasCustodian,statementswilleitherbesenttoyoudirectlybythethirdpartyCustodianorthroughCiti.
2.22.11 WherethelegalownershipofanInvestmentProductisdemonstratedbyaphysicaldocumentsuchasasharecertificate,theCustodianwillarrangefortheholdingofsuchadocumentinamannerwhichisappropriatetothevalueandriskoflossofthatInvestmentProduct.TheCustodianmaysafeguardthephysicaldocumentitselforarrangeforanagentorsub-custodiantodothis.TheCustodianoranappointedagentorsub-custodianasappropriatewillholdyourphysicaldocumentsoftitleseparatelyfromthephysicaldocumentsoftitlerelatingtoitsowninvestments.
2.22.12 Inaddition,youauthorisetheCustodian,anditsagentsorappointedsub-custodians,withouttheCustodian,itsagentsorappointedsub-custodiansbeingobliged,to:
2.22.12.1 signonyourbehalfanddeliverdocumentationandguaranteeyoursignaturetotransferInvestmentProducts,executealldeclarationsandaffidavitsandcertifyownershipofyourInvestmentProducts;
2.22.12.2 buyfrom,sell,orrecommendtoothers,thesameInvestmentProductsthatCitibuysfrom,sells,orrecommendstoyou;
2.22.12.3 collectinterestanddividendsandotherentitlements(orsharesorotherbenefitsinsteadofdividends)fromInvestmentProductsheldinyourCustodyAccount;
2.22.12.4 collectentitlementstosharesandanyotherbenefitsarising
fromcorporateevents.WhereyourInvestmentProductshavebeenpooled,suchentitlementsshallbedistributedinproportiontoyourentitlement,accordingtotheCustodian’srecordsofyourentitlement;and
2.22.12.5 updateyourCustodyAccounttoreflectanyoftheabovetransactions.
2.22.13 UnlessyouspecificallyinstructustodosoonacasebycasebasisorwearerequiredbytheInvestmentProductTermsorApplicableLaw,weshallhavenoobligationtotakeupanyrights,exerciseanyconversionorsubscriptionrights,dealwithanytake-overorotheroffersorcapitalreorganisationsorexerciseanyvotingrightsoveranysecuritiesorotherinvestments.
2.22.14 YoushallgiveinstructionsinrelationtothesafecustodyofyourInvestmentProductstoCitiinaccordancewiththeprovisionsofclause2.18.Yourinstructionsshallbecarriedoutsubjecttotheprevailinglaws,rules,operatingproceduresandmarketpracticeofanyrelevantstockexchange,clearingsystemormarketwheretheyaretobeexecutedorcarriedoutandshallbeactedupononlyduringBusinessDaysandnormalbusinesshoursandwhentheapplicablefinancialmarketsandotherinvolvedorganisationsareopenforbusiness.
2.22.15 UnlessotherwiseagreedandsubjecttoInvestmentProductTerms,orunlesswearerequiredbyApplicableLaw,theCustodianshallhavenoobligationtoforwardtoyouanyinformationregardingcorporateactions(whetherrelatingtodistributions,votingrights,rightsarisingunderareorganisation,rightsissueortakeover,orothercorporateevents)oranyotherinformationreceivedbytheCustodianinrelationtotheInvestmentProductsheldbytheCustodianoranynomineecompanyforyou.
2.22.16 Citireservestherightwithoutpriornoticetousethecustodyservicesofanysub-custodianandwillnotbeheldliableforanyactordefaultornegligencebyanysuchsub-custodian,exceptwhereCitihasfailedtoexercisereasonableskill,careanddiligenceintheselection,appointmentandperiodicreviewofanysuchsub-custodian,orintheeventofourfraud,negligence,wilfuldefaultorbreachoftheApplicableLaw.Upongivingyoupriornotice,CitireservestherighttoappointanotherCustodiantoprovidecustodyservicesdirectlytoyou.CitiwillnotbeheldliableforanyactordefaultornegligencebyanysuchCustodian,exceptintheeventofCiti’sfraud,negligence,wilfuldefaultorbreachoftheApplicableLaw.IntheeventoftheinsolvencyoranyotheranalogousproceedingsofathirdpartyholdingyourAssets,Citimayonlyhaveanunsecuredclaimagainstthethirdpartyonyourbehalf,andyouwillbeexposedtotheriskthatthesecurities,cashoranyotherpropertyreceivedbyCitifromthethirdpartyisinsufficienttosatisfyyourclaimandtheclaimsofallotherrelevantclients.
2.22.17 Asub-custodianmayhaveaninterestin,orlienorclaimover,orrightofsetoffinrelationto,theInvestmentProductsheldinyourCustodyAccount,totheextentwearepermittedtograntsuchrightsbytheApplicableLaw.
Ifanysub-custodianhassuchrights,wewillinformyouofthatfact.
2.23 Our rights over your Investment Products
2.23.1 ALienisarightwhichentitlesustoholdontoanyofyourInvestmentProductswehaveinourpossessionpendingpaymentofadebtowedbyyou.InadditiontoanyLienorotherrightstowhichwemaybeentitledunderanyApplicableLaw,weshallhaveageneralLienonallyourInvestmentProductsheldorcontrolledbyusorournomineesuntilthesatisfactionofallyourDebts,liabilitiesandobligations(whetheractualorcontingent)owedtousfromtimetotime.
2.23.2 IfyouhavefailedtopayusanyamountyouoweusunderthisAgreement,wemayapplyanycreditbalanceonanyaccountyoumaintainwithusinthesamename(s)toreduceorrepayanymoneyyouoweus.Thisiscalledourrightof“setoff”.
2.23.3 IfyouoweaDebttous,wemaysetoff,combineorconsolidatetheaccountsyoumaintainwithusinthesamename(s)andapplyanyproceedstosatisfyorreduceyourDebt.ThisisthecasewhethertheDebtisincurredindividuallyorjointlyandwhetheryouraccountisanindividualaccountorjointaccount.Wewillonlyeverdothisifthemoneyyouoweisimmediatelyrepayableorifweneedtopaytaxonyourbehalf.Wearenotobligedtoexercisethisrightbutwillnotifyyouatleast14daysbeforeweproposetodosounlesswereasonably
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thinkthatyouwilldosomethingtopreventusfromexercisingourright.
2.23.4 Wemayalsosetoff,combineorconsolidateanyfunds,deposits,balances,Debt,chequesorotherInvestmentProductsthatweholdforyou(inanycurrency),includingamountsowedtoyou,orintransittoyou.Wemaydothisinrelationtoatimedepositorotherinvestmentwhichhasnotmatured.Youagreethatwemayconvertanycurrenciesnecessaryforustosetoffinthisway.WewillusetheCitiUKReferenceExchangeRatetomakeanysuchconversion.
2.23.5 OursetoffrightisinadditiontoanyotherlegalrightswemayhaveundertheseTermsofBusinessorgenerally.
2.24 Third party Custodians
2.24.1 WhereCitiisnotactingasCustodian,youauthoriseustoenterintoanynecessarytermsofbusinesswithathirdpartyCustodianonyourbehalffortheprovisionofdealing,clearingandsettlement,safecustodyandotherassociatedservices.
2.24.2 Youacknowledgeandagreethat,whenCitientersintoanagreementwithathirdpartyCustodianforyou:
2.24.2.1 CitientersintotheagreementasyouragentsothatthereisadirectrelationshipbetweenyouandthethirdpartyCustodian;
2.24.2.2 thetermsofbusinessthatapplytoyourrelationshipwiththethirdpartyCustodianandhowthethirdpartyCustodianwillprovideitsservicestoyouarecontainedinthethirdpartyCustodian’stermsofbusiness.ThethirdpartyCustodian’stermsofbusinessmaydifferfromtheseTermsofBusiness;
2.24.2.3 CitiwillprovideyouwithacopyofthethirdpartyCustodian’stermsofbusinessthatapplytoyourrelationshipwiththethirdpartyCustodian.ByagreeingtobeboundbytheseTermsofBusiness,youarealsoagreeingtobeboundbythethirdpartyCustodian’stermsofbusiness,thereforeitisimportantthatyoureadthethirdpartyCustodian’stermsofbusiness.IfyouhaveanyqueriesonthethirdpartyCustodian’stermsofbusiness,youshouldaskCitibeforeagreeingtobeboundbythem.YoucancontactCition0800005500;
2.24.2.4 ifyoudonotwishtobeboundbythethirdpartyCustodian’stermsofbusiness,youcanterminatetheseTermsofBusinessinaccordancewiththeprovisionsofclause1.5;
2.24.2.5 CitimaygiveinstructionstothethirdpartyCustodianonyourbehalfandmayprovideinformationaboutyoutothethirdpartyCustodian.WhenthethirdpartyCustodianreceivessuchinstructionsorinformationfromCiti,thethirdpartyCustodianisentitledtorelyonitwithoutmakinganyfurtherchecksorenquiries;
2.24.2.6 ifanyinstructionorinformationisprovidedtoCitibysomeoneactingonyourbehalfunderapowerofattorney,thethirdpartyCustodianshall,uponreceiptofsuchinformationorinstructionsfromCiti,beentitledtorelyonitwithoutmakinganyfurtherchecksorenquiries;
2.24.2.7 thethirdpartyCustodianisauthorisedtoholdcashandinvestmentsonyourbehalfandtotransfersuchcashorinvestmentsfromyourCustodyAccounttomeetyourobligationstothethirdpartyCustodian;
2.24.2.8 thethirdpartyCustodianmayappointsub-custodians,nomineesoragentsinthecontextofprovidingcustodyservicestoyou;and
2.24.2.9 thethirdpartyCustodianandanysub-custodianofthatCustodianmayhaveaninterestin,orlienorclaimover,orrightofsetoffinrelationto,theinvestmentsheldinyourCustodyAccountandmaysetoffanyindebtedness,liabilitiesorobligationsthatyouowethemagainstanysumthatisduefromthemtoyou.IfthethirdpartyCustodianoranysub-custodianhassuchrights,thiswillbenotifiedtoyouinthetermsofbusinessofthatthirdpartyCustodianandthethirdpartyCustodianwillinformyouofanysucharrangementsapplicabletoanysub-custodian.
2.25 Packaged Retail and Insurance-Based Investment Products
2.25.1 Ingoodtimebeforeyouenterinto,andareboundbythetermsof,aPRIIPwearegenerallyrequiredtoprovideyouwithaKeyInformationDocument(“KID”).TheKIDisathree-pagedocumentproducedbytheproductmanufacturerandcontainskeyinformationforinvestorsaboutthePRIIP.
2.25.2 Whereyouconsenttousdoingso,wemayprovidetherelevant
KIDtoyouthroughawebsite(includingCitiOnline),viaemailoradurablemediumotherthanpaper.Youacknowledgethat:(i)thewebsiteoremaildoesnotconstituteanofferorarecommendationtoenterintoanytransaction,toparticipateinanytradingstrategyortoinvestinanyPRIIP;and(ii)unlesswearetheproductmanufacturer,wedonotgiveanyrepresentation,warrantyorundertakingastotheaccuracyorcompletenessoftheinformationcontainedintheKIDweprovidetoyou,astheKIDisproducedbytherelevantproductmanufacturer.
2.25.3 WhereweprovideyouwithaKIDbymeansofawebsite(includingCitiOnline),emailoradurablemediumotherthanpaper,youhavetherighttorequestapapercopyoftheKIDfreeofcharge.PleasecontactyourRelationshipManagerinordertoobtainacopy.
2.25.4 Whereyouconsenttousdoingso,whenanyKIDisprovidedtoyoubymeansofawebsiteorCitiOnlinewewillnotifyyoubyemailwhenanyrelevantKIDisavailableforaccessatthatlocation.
2.25.5 WhereyouhaveconsentedtotheprovisionofaKIDbyemailorwebsite(includingCitiOnline)andtheKIDhasbeenprovidedinthismanner,youagreeandacknowledgethatyouhaveregularaccesstotheinternet,andyouareresponsibleforhavinganynecessaryhardware,softwareorothertechnologytoreceiveandaccessanyKID(s)electronically.ShouldyousubsequentlytransactwithusinthatPRIIP,youagreethatyouhavehadanopportunitytoaccessorhavereceivedtherelevantKIDandhadsufficienttimetoreviewtheKIDpriortotheexecutionofsuchtransaction.
2.25.6 IfyoudonotconsenttotheprovisionofaKIDbymeansofawebsiteoradurablemediumotherthanpaper,ortheprovisionofaKIDinanon-paperformatisdeemedbyustobeinappropriate,wewillprovideyouwithapapercopyoftheKID.
2.25.7 WhereweprovideapapercopyoftheKID,youacknowledgethat:(i)theprovisionoftheKIDdoesnotconstituteanofferorarecommendationtoenterintoanytransaction,toparticipateinanytradingstrategyortoinvestinanyPRIIP;and(ii)unlesswearetheproductmanufacturer,wedonotgiveanyrepresentation,warrantyorundertakingastotheaccuracyorcompletenessoftheinformationcontainedintheKIDweprovidetoyou,astheKIDisproducedbytherelevantproductmanufacturer.
PART 3: INVESTMENT ISA
3. Investment ISA
Thefollowingclause3inregardstoInvestmentISAisonlyapplicabletoindividualswhoaretaxresidentintheUK.
3.1 Plan
3.1.1 ThePlanManagerwilladministeryourPlaninaccordancewiththeRegulationsandtheseISATermsofBusiness.IntheeventthattheRegulationsareamendedsuchthattheseISATermsofBusinessareinconsistentwiththem,theRegulationswillprevail.
3.1.2 We,asthePlanManager,mayadministeryourInvestmentinamannerwhichisdifferenttothewayinwhichtheproviderofanInvestmentstatesintheirdocumentation.Inthisinstance,thePlanManager’sprocessesandadministrationwillprevail.
3.1.3 ToapplyforaPlan,yourISAApplicationmustbefullycompletedandyoumustprovidetheinitialsubscriptionamount.InthecaseofanInvestmentISAtransfer,wewillmanageyourPlanuponreceiptoftheproceedsofyourpreviousPlanfromyourpreviousPlanManager.TheISAApplicationformspartoftheseISATermsofBusinessandifthetermsdiffer,thosecontainedintheseISATermsofBusinesswillprevail.
3.1.4 WeonlyoffernewInvestmentISAsand/oraccepttransfersofInvestmentISAsand/orCashISAs.WecanonlyacceptthecashproceedsfromyourexistingInvestmentISAandnottransfersofactualInvestments.Wereservetherightnottoacceptatransfer.
3.1.5 Ifapplicable,youmayopenmorethanonePlan,subjecttocompletionofanISAApplicationforeachPlan.
3.1.6 ThePlanManagerreservestheright,actingreasonably,torejectanapplicationforanyreason.ThePlanManagerwillnotifyyouifthishappens.
3.1.7 IfyoubecomeineligibletosubscribetoanInvestmentISAaftercommencinginvestmentinaPlan,youmustinformusimmediately.InthesecircumstancesyourPlanwillremain
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openbutnofurthersubscriptionsintoyourPlanwillbepermitteduntilyoumeettheeligibilityrequirementssetoutintheRegulations.
3.1.8 YoumustprovideuswithallinformationthatwerequireinordertomanageyourPlanforyouandmustadviseusimmediatelyinwritingofanychangeinyourcircumstanceswhichmayberelevanttoyourPlan,assetoutintheinformationyouprovide,orifyouarenolongerresidentintheUKfortaxpurposes.
3.2 Subscription
3.2.1 InordertosubscribetoandholdthePlanyoumustholdaBankAccountwithCitiinyourownsolename.Accountsheldinjointnames,orwhicharenotheldwithCiti,arenotacceptableforthispurpose.
3.2.2 SubscriptionstothePlancanbemadefromyourBankAccountonly.
3.2.3 TheseISATermsofBusinesswillcomeintoforceandyourPlanwillbeopened,orinthecaseofanexistingInvestmentISAorCashISAtransferandsubjecttoclause3.3below,willbegintobemanagedbyus,onthedateonwhichthePlanManagerreceivesavalidandcompleteISAApplicationandthesubscriptionmoniesorproceedsfromapreviousInvestmentISAorCashISA.
3.2.4 Youherebyconsenttousinvestingyourmoniesimmediately.Pleasenotethattheremaybeacostconsequenceasaresultofthisshouldyoudecidetoexerciseyourcancellationrightsasdetailedinclause3.4.
3.2.5 IfyouareaUScitizen,residentorholdagreencard,youcannotsubscribetoaPlan.
3.3 Transfers in
3.3.1 TransferofthecashproceedsfromanexistingInvestmentISAorCashISAcanbeexercisedusingtheInvestmentAdvisoryService.
3.3.2 IfyouaretransferringanexistingInvestmentISAorCashISAtous,suchatransfercanonlybemadebytransferofthecashproceedsfromtheexistingInvestmentISA.
3.3.3 TransfersofexistingInvestmentISAsandCashISAswillnormallybearrangedwiththePlanManagerfortheexistingISAandcantakeuptofourweeksormore,althoughtransfersfromaCashISAmaybequicker.OncetheInvestmentISAorCashISAhasbeentransferredtous,yourPlanwillbesubjecttotheISATermsofBusinesssetouthere.
3.4 Cancellation of a Plan
3.4.1 YouhavetherighttocancelyourPlanwhereitisconcludedbyface-to-facemeans(i.e.notbydistancemeans)within14daysof:
3.4.1.1 theconclusionofthecontract;or
3.4.1.2 thedateuponwhichyoureceivetheISATermsofBusinessandanyotherpre-contractualinformationorotherinformationthatwemayberequiredtoprovideyou,whicheveristhelaterdate.
3.4.2 Youmay,withoutgivinganyreason,exerciseyourcancellationrightbygivingthePlanManagernoticebeforeexpiryofthe14dayperiodtothefollowingaddress:
CitibankUKLimited InvestmentOperations POBox4012 Swindon,SN44JZ
3.4.3 YoudonothavetopayanythingtocancelyourPlan.However,ifyouexerciseyourrighttocancelbutwedonotreceiveyournoticetocanceluntilafterwehavepurchasedtheInvestmentsonyourbehalfandthevalueoftheInvestmentshasfalleninthattime,anamountequivalenttothefallinvalueoftheInvestments(calculatedonthedayonwhichyourInvestmentsareliquidated)willbedeductedfromtheamountofyoursubscriptionmonieswhicharerepaidtoyou.
3.4.4 Byexercisingyourrighttocancel,youwillwithdrawfromthePlananditwillbeterminated.Within30daysofreceivingthenoticeofcancellation,unlessclause3.4.5belowapplies,thePlanManagerwillaccounttoyoufortheproceedsoftheInvestments(subjecttoanyamountsdeductedassetoutinclause3.4.3above)andwillbeentitledtoretainanycashorInvestmentsrequiredtosettleanytransactionsalreadyinitiatedonyourbehalfandrequireyoutopayadditionalamountstosettlesuchtransactionsifrequired.
3.4.5 WhereyouexerciseyourrighttocancelthepurchaseofthePlanfollowinganInvestmentISAorCashISAtransfer,theInvestmentISAorCashISAwillbeclosedand(subjecttoanyamountsdeductedassetoutinclause3.4.3above)thecashproceedspaidtoyou,unlessyouarrangeforthetransferbacktotheoriginalmanagerorforthetransfertoanewmanager.YoumaynothavetherighttoreinstateyourISAwiththepreviousplanmanager,inwhichcaseallfuturetaxbenefitsmaybelost,unlessyouarrangeforthetransfertoanewmanager.
3.4.6 Ifyoudonotexerciseyourrighttocancel,yourPlanwillcontinueunlessanduntilitistransferredtoanotherplanmanagerinaccordancewithclause3.13orterminatedinaccordancewithclause3.14.
3.5 Investment choice and your investment objectives
3.5.1 YourPlansubscriptionswillbeinvestedintheInvestmentsintheproportionsspecifiedinyourISAApplication.
3.5.2 TheinvestmentobjectivesoftheInvestmentsorotherInvestmentProductsinwhichyourPlaninvestswilldeterminetheinvestmentobjectiveofyourPlan.YoucanobtaininformationonaFund’sinvestmentobjectiveandpolicy,feesandinvestmentrestrictionsfromeachFund’sprospectus,keyinvestorinformationdocumentorKIDandotherproductdocumentation.YoushouldreadeachFund’skeyinvestorinformationdocumentorKIDandotherproductdocumentationcarefullybeforeinvesting.
3.6 Investing in your Plan
3.6.1 YoucaninvestinyourInvestmentISAbymakingoneormorelumpsumpayments,bymakingregularpaymentsorbycombiningthese.
3.6.2 IfyouinvestviaCitiOnline,theminimumlumpsuminvestmentamountis£500perFundandtheminimumregularinvestmentamountis£500perFund.
3.6.3 IfyouinvestthroughaRelationshipManager,theminimumlumpsuminvestmentamountis£10,000intotalandtheminimumregularinvestmentamountis£500perFund.
3.6.4 RegularmonthlypaymentswillbecollectedfromyourBankAccountonthedateweagreewithyouwhenyouapplyforyourPlan.
3.6.5 TheminimumholdingamountforyourPlanisthesameastheminimumlumpsumamountspecifiedinclauses3.6.2or3.6.3above,asapplicable.
3.6.6 ThecostofpurchasingyourchosenInvestmentsmaynotexactlymatchtheamountofmoneywhichyouwishtoinvestduetothepriceoftheunderlyingunits.Insuchcircumstanceswewillpurchase(orarrangetobepurchased)asmanyunitsofyourInvestmentsaspossiblewithyourmoney.Anyresidualbalancefromyourmoneywillbeheldonyourbehalfbyusuntilsuchtimeastheaccumulativeamountreaches£10,atwhichpointthemoneywillbepaidintotheBankAccountfromwhichyourinvestmentmoneywasoriginallydebited.
3.6.7 TomakesubsequentlumpsuminvestmentsintoyourPlan,alsocalled‘toppingup’,youwillbesubjecttothesameminimumsandthesamepaymentmethodsasoutlinedabove.YourtotalinvestmentintothePlaninanygiventaxyearmustnotexceedthetotalISAallowanceforthatyear.
3.6.8 CitiwilltellyouwhatthecurrentannualISAallowanceisuponrequest.
3.7 Instructions
3.7.1 Investmentinstructionsshouldcomplywiththeprovisionsofthisclause3.7.Weneednotacknowledgereceiptofyourinstructions.Whenwebuyandsell(orarrangetobeboughtandsold)Investmentsatyourinstruction,pleasenotethat:
3.7.1.1 thepurchaseorsaleofInvestmentswillbesubjecttous(orathirdparty)complyingwithapplicablemarketrulesandregulations.Wherewecarryoutthepurchaseorsale,weshallnotifyyouiftheserulesandregulationspreventusfromcarryingoutyourinstructionsandshallnotbeliabletoyouifthisisthecase(subjecttoclause1.11.4);and
3.7.1.2 wewillnotexecute(orarrangetobeexecuted)orderstobuyyourPlanunlessyouhold,oryouhavearrangedforustohold,thenecessaryfundsintheBankAccountreferredtoinclause3.2.1,orhavesentachequefromanotherinstitutionwiththeminimumbalancewhichhassubsequentlycleared.
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3.7.2 However:
3.7.2.1 ifthePlanyouwishtosellisnotheldbyusonyourbehalf,ortheinvestmentshavenotbeenreceivedbyusorouragents,wemayrefusetoexecuteasale(orarrangeforthesaletobeexecuted);
3.7.2.2 ifanyInvestmentwesellforyou(orarrangetobesold)foryouisdefectiveorisnotdeliveredintimeforreasonsbeyondourreasonablecontrol,wemayrepurchaseit(orarrangeforittoberepurchased)atyourexpense;
3.7.2.3 iffundsnecessarytopurchasethePlanyouwishtobuyhavenotbeenreceivedbyusontheexpecteddate,wemayrefusetoexecuteasale(orarrangeforthesaletobeexecuted);and
3.7.2.4 ifatransactionwouldresultinafractionalshare,wemayadjustthesizeofthetransaction(downorup,atoursolediscretion,actingreasonably)tobringtheholdingtoawholenumberofshares.
3.7.3 InstructionswillnormallybeprocessedbycloseofbusinessonthenextBusinessDayfollowingtheBusinessDayonwhichtheinstructionswerereceivedbyus(butinanycasenolaterthancloseofbusinessonthesecondBusinessDayafterwereceiveyourinstructions).However,pleasenotethatwhereinstructionsare:
(a) foranewtaxyearbutreceivedaspartofadualtaxyearapplicationformorotherwiseinthepriortaxyear;or
(b) receivedwithinthefirstweekofanewtaxyear,instructionswillbeprocessedwithin10BusinessDaysofthelaterofthestartofthenewtaxyearortheBusinessDayonwhichtheinstructionswerereceivedbyus.
3.7.4 Thepriceofyourpurchaseorsalewillbeavailablewhenyouplaceyourdealwithus.ThepriceyouwillbegivenwillbecalculatedattheFundprovider’svaluationpoint,detailsofwhichcanbefoundintheFund’sprospectus.Thepricewillbeconfirmedtoyouinthetradeconfirmationthatissenttoyou.
3.7.5 Ifyousoelect,wewillarrangeforyouto:
3.7.5.1 receivetheannualreportandaccountsfortheInvestments;
3.7.5.2 beabletoattendshareholders’orunitholders’meetings;
3.7.5.3 beabletovoteatsuchmeetings;and
3.7.5.4 beabletoreceiveanyotherinformationissuedtoshareholdersorunitholders.
Wereservetherighttomakeareasonablechargeforprovidingtheseservices.Suchchargesmaybevariedinaccordancewithclause1.1.1.3.
3.8 Income from your Plan
3.8.1 Dependingonyourinvestmentobjectiveandthetypeofunits/sharesyoupurchaseinyourchosenInvestments,anyincomemadeinrelationtoyourInvestmentswill:
3.8.1.1 bedistributedtoyouonceitisreceivedbytheCustodian;
3.8.1.2 beusedtopurchaseadditionalunits/sharesonyourbehalf;or
3.8.1.3 automaticallybereflectedinthenetassetvalueoftheInvestmentsinyourPlan.
YourchoiceoftheabovemustbemadeonyourISAApplicationwhenyoumakeyouroriginalsubscription.Pleasenote,however,that,forcertainInvestmentProducts,notalloftheoptionslistedabovemaybeavailable.
3.9 Assets held within your Plan
3.9.1 AnycashreceivedbyyourPlanincludinganyincomepaymentsandtaxcreditsresultingfromtheproceedsofanInvestmentsalewillbeheldinaccordancewiththeApplicableLawandthetermsrelatingtocustodyservicessetoutbelowinclause3.10.
3.9.2 YouconfirmthattheISAinvestmentswillbeandwillremaininyourbeneficialownershipandmustnotbeusedassecurityforaloan.
3.10 Custody services
3.10.1 BycompletinganISAApplication,witheffectfromthedateonwhichtheISAApplicationiscompletedyouauthoriseCitieithertoperformtheroleofCustodian,ortoappointathirdpartyCustodian,sub-custodianoragentasCitimaydecide,actingreasonably,toprovidecustodyservicesforyourPlanonthetermssetoutinPart2CoftheseTermsofBusinessforInvestmentServices.
3.10.2 YouagreethatlegaltitletoyourISAinvestmentswillbevestedinthenameofanomineecompanyoracompanycontrolledbythenomineecompanyandbeingamemberofthenominee’sgroupofcompanies.
3.11 Documentation
3.11.1 Wewillacknowledgeinwriting,whereapplicable:
3.11.1.1 yourapplicationtoopenaPlan;
3.11.1.2 yourrequesttotransferanInvestmentISAorCashISAtous;or
3.11.1.3 thedetailsofanyindividualtransactioninrelationtoyourPlan.
3.12 Withdrawals
3.12.1 YoucanmakepartialcashwithdrawalsfromyourPlanatanytimeuponprovidinguswithwritteninstructionsinlinewiththeseISATermsofBusiness.IfyourproposedwithdrawalwouldresultinyourInvestmentsfallingbelowtheminimumrequirementfortheInvestmentsasspecifiedinclause3.6,wemaytreatyourwithdrawalasaninstructiontoterminateyourInvestmentISA.
3.12.2 Wewillimplementyourinstructionswithinsuchtimeasisstipulatedbyyouinthewritteninstructionssubjecttoareasonablebusinessperiodrequiredforthepracticalimplementationoftheinstructions(whichmustnotexceed30days).
3.12.3 SubjecttotheRegulationsandanyinstructionyougiveus,andunlessyourconsentisprovidedforustosellcertainInvestmentsinordertomeetyourwithdrawalrequest,wewillallocateequalpercentagestosellacrossyourInvestments.
3.12.4 AllmoniesinvestedinyourPlan,evenifwithdrawn,willcounttowardsyourannualInvestmentmaximuminaccordancewiththeRegulations.
3.13 Transfers to other plan managers
3.13.1 SubjecttotheRegulations,youhavetherightatanytimetotransferyourPlantoanotherplanmanager.
3.13.2 Toeffectatransferyoumustsubmittousawritteninstructionand/oraletterofacceptancefromyournewISAmanager.Thetransferwilltakeplacewithinsuchtimeasisstipulatedbyyouinthewritteninstructionssubjecttoareasonablebusinessperiodrequiredforthepracticalimplementationoftheinstructions(whichisusuallyfourweeksbutmustnotexceed30days).WewillhaveabsolutediscretionastowhethertoeffectthetransferincashfollowingthesaleofallInvestmentsheldbyyouorwhethertotransferthelegaltitletotheInvestmentsdirectlytoyournewplanmanager.
3.13.3 InaccordancewiththeRegulations,ifyouwishtotransferanInvestmentISAforthecurrentyear,thetransfermustbeeffectedinrespectofallthesubscriptionsmadethatyear.InrelationtoISAsopenedinrespectofapreviousyearthetransfermustbeeffectedinrespectofallholdingsheldinthatyear’sPlan.
3.13.4 Nopartialtransferswillbeallowed.
3.14 Termination
3.14.1 ThePlanmaybeterminatedbythePlanManagerinthefollowingcircumstances:
3.14.1.1 immediatelyongivingwrittennoticetoyouif,initsreasonableopinion,itisimpossibletoadministerthePlaninaccordancewiththeRegulationsoryouareinbreachoftheRegulations.ThePlanwillterminateautomaticallyifitfailstosatisfytheprovisionsoftheRegulations.ThePlanManagerwillnotifyyouinwritingif,byreasonofanyfailuretosatisfytheprovisionsoftheRegulations,yourPlanceasestoqualifyasanISA(i.e.isnolongertaxexempt);
3.14.1.2 on30days’writtennoticeifyoufailtopayanymoneydue;or
3.14.1.3 on30days’writtennoticeifyouareinbreachofanyoftheseISATermsofBusiness.
Inthesecircumstances,anyInvestmentsinthePlanwillbesoldandtheproceedstransferredtoyou,subjecttoourrighttoretaincashinrespectofourfees(assetoutinclause1.12ofPart1).
3.14.2 YoumayterminateyourPlanatanytimebywritteninstructions.WewilleffecttheterminationofyourPlanbysellingtheInvestmentsandtransferringthecashproceedstoyou.Thewithdrawalwilltakeplacewithinsuchtimeasisstipulatedbyyouinthewritteninstructionssubjecttoareasonablebusinessperiodrequiredforthepracticalimplementationoftheinstructions(whichmustnotexceed30days).
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3.15 Death
From6April2018,intheeventofyourdeath:
3.15.1 wewilltransferthecashproceedsfromthesaleoftheInvestmentsinyourPlantoyourpersonalrepresentativeontheirinstruction;
3.15.2 inaccordancewiththeIndividualSavingsAccountsRegulations1998,yourPlanwillberegardedasacontinuingaccountofadeceasedinvestor(andtherebycontinuetoreceivebeneficialtaxtreatment)untiltheearlierof:
(a)thecompletionoftheadministrationofyourestatebyyourpersonalrepresentative;
(b)thedayfallingonthethirdanniversaryofyourdeath;or
(c) theclosureofyouraccountwithinthemeaningofregulation4B(3)(a)oftheIndividualSavingsAccountRegulations1998;and
3.15.3 wewillnotacceptanyfurtherpaymentsintoyourPlanafterthedateofyourdeath.AnyarrangementsforthepaymentofmoneyintoyourPlanwillceasetoapplyafteryourdeath.
3.16 Charges
3.16.1 TheKeyFactsDocumentcontainsinformationaboutthecostsrelatingtoinvestinginthePlan.
3.16.2 Subjecttocompliancewithclause1.1ofPart1,wereservetherighttointroduceadditionalchargesinthefuturetocoveranyadditionalexpensesincurredbyusasaresultofamaterialchangeinRegulations.Shoulditeverbecomenecessarytointroducesuchacharge,youwillbegiven30days’writtennotice.YoumayatanytimeterminateyourPlaninaccordancewithclause3.14.
3.17 Records of your Plan
3.17.1 Wewillundertaketodothefollowing:
3.17.1.1 maintainallsuchrecordsrelatingtoyourPlan;
3.17.1.2 makeappropriatereturnstoHMRevenueandCustomsforthepurposesoftaxation;and
3.17.1.3 providealltaxationdetailstoyou,asmayberequiredundertheRegulations.
3.18 Delegation of functions
WemayappointathirdpartytoactinrespectofanyfunctionrelevanttotheadministrationofyourPlan.Shouldweappointathirdparty,wewillsatisfyourselvesthatanysuchthirdpartyiscompetenttocarryoutthosefunctionsorresponsibilities.Weshalltakefullresponsibilityfortheactionsandomissionsofanysuchthirdparty.
3.19 Exclusion of liability
3.19.1 YourattentionisdrawntotheKeyFactsDocument,andtheinformationprovidedtoyouwhenyoumakeyourISAApplication,aswellastheriskssetoutintheprospectus,andkeyinvestorinformationdocumentforeachFundinwhichyouinvest.
3.19.2 Subjecttoclause1.11,weacceptnoresponsibilityfortheperformanceorprofitabilityofthePlan.
3.19.3 ThepriceofInvestmentscangodownaswellasupandthereisadegreeofriskattachedtostockmarketinvestments(inwhichyourchosenInvestmentsmayinvest).Youmaynotgetbacktheamountinvested.
3.19.4 Youareremindedthatpastperformanceisnotareliableindicatoroffutureresults.
3.19.5 WewillnotbeliableforanylossyouexperiencethroughafallinvalueoftheInvestments.
SCHEDULE 1: CONTRACTS ENTERED INTO AT A DISTANCE
1. Distance Contracts
WhenCitientersintoanagreementwithyouincircumstanceswhereCitihasnoface-to-facephysicalcontactwithyou,Citiisrequiredtoprovideyouwithcertaininformationover
andabovethatsetoutinthemainbodyoftheseTermsofBusinessandtogiveyoucertainadditionalcancellationrights.ThisSchedulesetsoutthenecessaryinformationandcancellationprovisionsandshouldbereadwith,andformpartof,theseTermsofBusiness.
2. Information about Citi
CitibankUKLimitedisauthorisedbythePrudentialRegulationAuthorityandregulatedbytheFinancialConductAuthorityandthePrudentialRegulationAuthority.ItappearsontheUK’sfinancialservicesregisterwithfirmreferencenumber805574.CitibankUKLimitedisacompanylimitedbysharesandregisteredinEnglandandWaleswithUKregistrationnumber11283101.CitibankUKLimited’sregisteredaddressisCitigroupCentre,CanadaSquare,CanaryWharf,LondonE145LB.ItsVATnumberis429625629.
TofindoutmoreaboutuspleaseseethePRA/FCAregisteratwww.fca.org.uk/registerorcalltheFCAon08001116768orPRAon02034614878.
3. Information about Citi’s services
SomeofCiti’sservicesrelatetoinstrumentswhosepricedependsonfluctuationsinthefinancialmarketsoutsideCiti’scontrol.Theseproductsarenotanobligationof,orguaranteedby,Citiandaresubjecttoinvestmentrisks,includingpossiblelossoftheprincipalamountinvested.Pleasenotethatpastperformanceisnotareliableindicatoroffutureresultsandinvestmentscangodownaswellasup.
4. Information about charges, costs and taxes
Citi’schargesandthearrangementsforpaymentaresetoutintheKeyFactsDocumentandtheInvestmentCostsandChargesIllustration.NoseparatechargewillbeleviedforusingameansofDistanceCommunication.Youmaybesubjecttotaxesandcosts,whicharenotpaidthroughCitiorimposedbyCiti.
5. Information about the Terms of Business
EnglishlawistakenbyCitiasthebasisfortheestablishmentofrelationswithyoupriortotheconclusionoftheseTermsofBusiness.TheseTermsofBusinessaregovernedbythelawofEnglandandWales.TheseTermsofBusinessaresupplied,andCitiwillcommunicatewithyouduringthecourseoftheTermsofBusiness,intheEnglishlanguage.TheseTermsofBusinesshavenominimumduration.
6. Cancellation rights: these Terms of Business
WhereyouhaveenteredintotheseTermsofBusinessincircumstanceswhereCitihasnoface-to-facephysicalcontactwithyou,youmayhavearighttocanceltheseTermsofBusiness.Thiscancellationrightapplieswithin14daysfromthelaterof:
(a) thedayofconclusionoftheseTermsofBusiness;or
(b) thedayonwhichyoureceivetheseTermsofBusinessandanyotherpre-contractualorotherinformationthatwemayberequiredtoprovideyou.
ThiscancellationrightappliestotheTermsofBusinessthemselvesandnottotransactionscarriedoutbyCitiundertheTermsofBusiness.ThecancellationoftheTermsofBusinessbyyouwillnotresultintheunwindingoftransactionseffectedduringthecancellationperiod(althoughyoumayhaveadditionalcancellationrightsinrespectofsuchtransactionsassetoutinclause1.4ofPart1).YouagreethatCitimaybegintoprovideservicesundertheTermsofBusinessnotwithstandingyourrighttocanceltheTermsofBusiness.Youmay,withoutgivinganyreason,exerciseyourcancellationrightbygivingCitiwrittennoticebeforeexpiryofthe14dayperiodtothefollowingaddress:
CitibankUKLimitedOperationsDepartmentPOBox4012Swindon,SN44JZ
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ByexercisingyourrighttocancelyouwillwithdrawfromtheTermsofBusinessandtheTermsofBusinesswillbeterminated.Citiwillpayyouwithoutdelay,andnolaterthan30daysafterthedateonwhichCitireceivednoticeofcancellationfromyou,anysumwhichyouhavepaidtoCitiorforCiti’sbenefitinconnectionwiththeTermsofBusiness(includingsumspaidbyyoutoCitiagents).Notwithstandingtheabove,youagreetopayfortheservicesCitihasactuallyprovidedinconnectionwiththeTermsofBusiness;suchpaymentwillbeinproportiontotheextentoftheservicesalreadyprovidedtoyou.
YouagreethatCitiisentitledtoreceivewithoutdelay,andnolaterthan30daysafterthedateonwhichyoupostedorotherwisesentnoticeofcancellationtoCiti,anysumsorpropertyorboththatbecameyoursundertheTermsofBusiness.
This14daycancellationrightisinadditiontoyourrighttoterminatetheseTermsofBusinessbynoticegiveninwritingatanytimeasprovidedforinclause1.5ofPart1oftheseTermsofBusiness.Your14daycancellationright,thearrangementsforexercisingthatrightandthechargesthatCitimaylevyupontheexerciseofthatrightareconfinedtothebeginningoftherelationshipbetweenCitiandyouandareseparatefromthestandardterminationarrangementsinclause1.5ofPart1oftheseTermsofBusinesswhichwilloperatethereafter.IfyouchoosenottocanceltheseTermsofBusiness,theywillcontinueinforceunlessanduntilterminatedinaccordancewithclause1.5ofPart1.
7. Contact details
CitibankUKLimitedLevel10,CitigroupCentre133CanadaSquareLondon,E145LBUnitedKingdom
VisitCitibankUKLimitedwebsiteatwww.citibank.co.uk
SCHEDULE 2: INVESTMENT PRODUCT TERMS
WherethereisaconflictbetweentheseInvestmentProductTermsandtheTermsofBusinesssetoutinthemainbodyofhisdocument,theseInvestmentProductTermswillprevail.
1. Collective Investment Schemes
1.1 TheseInvestmentProductTermsaresubjecttotheTermsofBusinesswhichgovernCiti’srelationshipwithyouandtheprovisionofinvestmentadvice.
1.2 Thekeyinvestorinformationdocument,KIDorsimplifiedprospectus(asapplicable)shouldbereadbyyouinconjunctionwiththeseInvestmentProductTermsforeachcollectiveinvestmentschemewhichyouareconsideringinvestingin.Thekeyinvestorinformationdocument,KIDorsimplifiedprospectusapplicabletoeachcollectiveinvestmentschemewillcontainriskwarningswhichyoumustreadpriortoinvesting.
1.3 Collectiveinvestmentschemesenableyoutoinvestininternationalmonetaryinstruments,bonds,equities,othersecuritiesandcommoditiesbypurchasingunitsorsharesinacollectiveinvestment,whichholdaportfoliooforotherwiseobtainexposuretosuchinvestments.
1.4 YouauthoriseCiti,wheresoinstructedbyyou,topurchaseorsell(orarrangethepurchaseorsaleof)sharesorunitsinFundsforyouraccount.
1.5 Allinstructions,includingrequeststobuyandsellunitsincollectiveinvestmentschemes,mustbesenttoCitionthetermsoftherelevantcurrentprospectusfortherelevantcollectiveinvestmentschemeandwillbesubjecttotherulesandregulationsgoverningthatparticularcollectiveinvestmentscheme.InstructionswillnormallybeprocessedbycloseofbusinessonthenextBusinessDayfollowingtheBusinessDayonwhichtheinstructionswerereceivedbyus(butinanycasenolaterthancloseofbusinessonthesecondBusinessDayafterwereceiveyourinstructions).Pleasenote,however,thatwherewereceiveinstructionstosellandrepurchaseunitsinthesamecollectiveinvestmentschemesuchinstructionswillbecarriedoutseparatelyandtherepurchasewillonlybeprocessedoncethefirstinstructiontosellhassettled.Thismeansthatsuchinstructionswillpotentiallybesubjecttodifferentprices.
1.6 Pleasebeawarethat,whereyouexerciseyourcancellationrightsafterhavingenteredintoaninvestmenttransaction,youmayreceivebacklessthantheamountinitiallyinvestedif
thevalueofyourinvestmenthasgonedownduringtheperiodpriortocancellation.
1.7 WhereCitiiscarryingoutyourinstructions,allunitsorsharesincollectiveinvestmentschemeswillbeheldinthenameofanappointednomineecompany.PleaseseePart2oftheseTermsofBusinessfordetails.
1.8 Unlessotherwiseagreedwithyou,orunlesswearerequiredbyApplicableLaw,Citiandanyappointednomineeoragentshallnotbeobligedtoadviseyouofanycommunicationsthatarereceivedinrelationtoyourinvestmentinacollectiveinvestmentscheme,nortotakeanyactioninrelationtosuchcommunications.InparticularCitiandappointednomineesoragentswillnotbeunderanyobligationtoconsultyouastohoworwhetherthevotingrightsattachedtotheunitsorsharesinthecollectiveinvestmentschemeinwhichyouinvestshouldbeexercisedandshallhavecompletediscretionastowhethertoexercisesuchvotingrightsatall.
1.9 Anyinterest,dividends,andotherincomeandcapitalgainsfromunitsorsharesincollectiveinvestmentschemesmaybesubjecttotaxes,includingWithholdingTax.
1.10 YouaresolelyresponsibleforpayingtaxesorWithholdingTaxarisingfromthepurchaseorsaleofyourunitsorsharesincollectiveinvestmentschemes.Inaddition,youareresponsibleforanystamporexcisetaxesorestatetaxesassociatedwithyourInvestments.IfCitipaysanyofthesetaxesforyou,youagreethatCitimaydeducttheamountpaiddirectlyfromyourInvestmentAccountorBankAccount.Citihasnoobligationtoreclaimforyouanyexcesstaxeswithheld.
1.11 Subjecttoclause1.11ofPart1oftheseTermsofBusiness,Citiacceptsnoresponsibilityfortheperformanceorprofitabilityofyourinvestmentincollectiveinvestmentschemes.Youmustbeawarethatthevalueofanyinvestmentcangodownaswellasupandthatthereisadegreeofriskattachedtostockmarketinvestments(inwhichyourchosencollectiveinvestmentschememayinvest).Youmaynotgetbacktheamountyouinvested.Youareremindedthatpastperformanceisnotareliableindicatoroffutureresults.
1.12 Dependingonthetypesofunitsand/orsharesavailableinthecollectiveinvestmentschemeinwhichyouchoosetoinvest,youmayopteither:
1.12.1 foranyincometheunitsand/orsharesmightmaketobedistributedtoyouonceitisreceivedbytheCustodian;
1.12.2 foranyincometobeautomaticallyreinvestedtopurchaseadditionalunitsand/orsharesinyourchosencollectiveinvestmentscheme(s);or
1.12.3 topurchaseonlyaccumulationunitsand/orshareswhichdonotdistributeincomebutwhereanyincreaseintheirvalueisreflectedinthenetassetvalueofthesharesand/orunitsinthecollectiveinvestmentscheme.
Pleasenote,however,that,forcertainInvestmentProducts,notalloftheoptionslistedabovemaybeavailable.
1.13 Thecostofpurchasingunitsorsharesforyoumaynotexactlymatchtheamountofmoneywhichyouwishtoinvestintheunitsorshares.InsuchcircumstancesCitiwillpurchase(orarrangetobepurchased)asmanyunitsaspossiblewithyourinvestmentmoney.AnyresidualbalancefromyourinvestmentmoneywillbeheldonyourbehalfbyCitiinyourInvestmentAccountuntilsuchtimeastheaccumulativeamountreaches£10,atwhichpointthemoneywillbepaidintoyourBankAccountfromwhichtheinvestmentmoneywasdebited(orotheraccountasyoumayadvise).
2. ISAs
TheISATermsofBusinesswhichrelatespecificallytoISAsarecontainedinPart3oftheseTermsofBusiness.
3. Structured notes
Thetermsandconditionswhichrelatespecificallytostructurednotesarecontainedinaseparatedocumententitled‘SubscriptionAgreement’.
4. Investment Funds Account
4.1 TheseInvestmentFundsAccountTermsofBusiness(the“Investment Funds Account Terms”)setoutthebasisuponwhichtheInvestmentFundsAccount,paidforviaaFixedPercentageMonthlyCharge(the“Investment Funds Account”),isofferedtoyou.
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4.2 TheseInvestmentFundsAccountTermstakeeffectfromthedatewhenyourInvestmentFundsAccountisopenedandshouldbereadinconjunctionwiththeTermsofBusiness(the“General Terms”)includingtheKeyFactsDocument.AllofthesedocumentsformpartofthecontractualagreementbetweenyouandCiti.YoushouldensureyoureadandunderstandallthesedocumentsbeforedecidingtoopentheInvestmentFundsAccount.
4.3 UnlessotherwisedefinedintheseInvestmentFundsAccountTerms,thedefinitionsincludedintheGeneralTermsapply.TotheextentthatthereisaninconsistencybetweentheseInvestmentFundsAccountTermsandtheGeneralTerms,theseInvestmentFundsAccountTermswilltakeprecedence.
4.4 InvestmentAdvisoryServices:
4.4.1 AspartofourInvestmentAdvisoryServiceyouwillbeabletoreceiveinvestmentadvicefromusonatransaction-by-transactionbasisandalsorequestperiodicportfolioreviewsonanadhocbasis.IfyoupaytheFixedPercentageMonthlyChargeforyourInvestmentFundsAccountyouwillnotbechargedaseparateAdvisoryFee,TransactionFeeorGlobalCustodyFee,assetoutbelowandintheKeyFactsDocument.
4.4.2 Thisisnotafiduciaryrelationship.CitiwillnotmakeinvestmentdecisionsregardingyourInvestmentFundsAccount.Althoughyoumaymakeinvestmentdecisionsbasedonguidanceorrecommendationsprovidedbyus,thedecisiontoproceedwiththeinvestmentissolelyyours.TransactionsintheInvestmentFundsAccountareexecutedsolelyuponyourinstruction.YoushouldfullyreviewSchedule4UnderstandingourServicesandRisksintheGeneralTermsbeforemakinganyinvestmentdecisions.
4.5 Eligibilitycriteria:
4.5.1 TheInvestmentFundsAccountisavailabletotheclientsofCitibankUKLimitedwhoarealsoUKresidents,andareeitherCitigoldcurrentaccountholdersorCitigoldPrivateClients.
4.5.2 Theminimuminvestmentandtheminimumholdingamountis£200,000oracurrencyequivalent.IfthevalueofyourInvestmentFundsAccountfallsbelow£200,000duetoyourinstructiontoredeemortransferoutsomeoralloftheholdings,youwillberequiredtomakeadditionalinvestmentstobringthevalueofyourInvestmentFundsAccountbackto£200,000.IfthevalueofyourInvestmentFundsAccountremainsbelow£200,000forover30days,forreasonsotherthanadecreaseinthemarketvalueoftheAssetsintheInvestmentFundsAccount,CitimayterminatetheseInvestmentFundsAccountTermsassetoutbelow.
4.6 Keypointstoconsider:
4.6.1 TheInvestmentFundsAccountcanonlybeusedtoinvestinFundsandcannotbeusedtoinvestinotherInvestmentProducts.
4.6.2 TheInvestmentFundsAccountcanonlybeopenedviayourRelationshipManager.
4.6.3 TheAssetsheldinyourInvestmentFundsAccountcannotbeheldinanInvestmentISA.
4.6.4 InformationaboutregularinvestmentcontributionsiscontainedinPart2atclause2.5.RegularinvestmentcontributionscanbemadefromyourBankAccountonly.ThesewillbecollectedfromyourBankAccountonthedateweagreewithyouwhenyousetupyourregularcontributionarrangements.IfyouestablisharegularinvestmentplantoinvestinFunds,theminimumregularinvestmentamountis£500perFund.
4.7 Charges:
4.7.1 DetailsofthecosttoyouofhavingtheInvestmentFundsAccountaresetoutintheKeyFactsDocument.
4.7.2 InrelationtotheInvestmentFundsAccount,youwillbechargedaFixedPercentageMonthlyChargeassetoutintheKeyFactsDocument.TheFixedPercentageMonthlyChargecoverstheprovisionoftheInvestmentAdvisoryService,theexecutionofyourtransactionsandcustodyservices.
4.7.3 YouwillnotbechargedaTransactionFeeoraseparateAdvisoryFeeonthetransactionswithinyourInvestmentFundsAccount.YouwillnotbechargedaseparateGlobalCustodyFeeontheAssetsheldintheInvestmentFundsAccountascustodyservicesarecoveredbytheFixedPercentageMonthlyCharge.
4.7.4 TheFixedPercentageMonthlyChargewillbedeductedfromtheBankAccount(s)linkedtoyourInvestmentAccountinaccordancewithclause2.3ofPart2.Iftheamountinyour
BankAccountisinsufficienttocovertheFixedPercentageMonthlyCharge,wemayliquidateassetsfromyourportfolioinordertopaytheFixedPercentageMonthlyCharge.
4.8 AmendingtheseInvestmentFundsAccountTerms:
Citimaychange,vary,amendorsupplementtheseInvestmentFundsAccountTermsinaccordancewiththeprovisionsofclause1.1ofPart1.
4.9 TerminatingtheseInvestmentFundsAccountTerms:
4.9.1 YoumayterminatetheseInvestmentFundsAccountTermsandsomayCiti.Theterminationprovisionsincludedinclause1.5ofPart1willalsoapplytotheseInvestmentFundsAccountTerms.YoushouldbeawarethatterminationoftheseInvestmentFundsAccountTermswillalsoterminatetheprovisiontoyouofourInvestmentAdvisoryServiceinrelationtotheInvestmentFundsAccount.
4.9.2 Inadditiontotheprovisionsinclause1.5ofPart1,youshouldbeawarethatCitimayalsoterminatetheseInvestmentFundsAccountTermswherethevalueofyourInvestmentFundsAccountremainsbelow£200,000forover30days,forreasonsotherthanadecreaseinthemarketvalueoftheAssetsheldinyourInvestmentFundsAccount.Insuchsituations,CitimayclosetheInvestmentFundsAccountby30days’priorwrittennoticetoyou.IntheeventthatCiticlosestheInvestmentFundsAccount,CitiwillliquidatetheAssetsheldinyourInvestmentFundsAccountunlessyouprovideaninstructiontotransferyourAssetstoanotherInvestmentAccountyouholdwithCitiortoathirdparty.CitiwillliaisewithyoutodeterminewhereyouwishyourAssets,orproceedsfollowingliquidation,tobetransferred.
SCHEDULE 3: CLIENT MONEY
1. Client money
1.1 MoneyheldforyouinanaccountwithuswillbeheldbyusasbankerandnotasclientmoneyundertheApplicableLawand/ornotastrustee.AsaresultofthemoneynotbeingheldasclientassetsundertheApplicableLaw,youwillnotbeentitledtoshareinanyspecificclientmoneydistributionintheeventofCiti’sinsolvency(oranalogousevent).
1.2 Whereyouoweusmoney,wemayusemonieswhichweholdonyourbehalf(whetherheldasasoleInvestmentAccountHolderoraJointInvestmentAccountHolder)inortowardssatisfactionofallorpartoftheamountyouowetoCitiinthesamename(s).Wewillonlyeverdothisifthemoneyyouoweisimmediatelyrepayableorifweneedittopaytaxonyourbehalf.Wearenotobligedtoexercisethisrightbutwillnotifyyouatleast14daysbeforeweproposetodoso.
2. Unclaimed custody assets
Intheeventthatthereisnomovementoveranaccountyouholdwithusforaperiodof12years(inrelationtoyourAssets),notwithstandinganyassetservicingdiscretionexercisedbyusintheabsenceofinstructionsfromyou,andweareunabletocontactyouhavingmadereasonableattemptstodoso,wemaytransferyourmoneyorAssets,ortheliquidationproceedstoaregisteredcharityofourchoice.Inthesecircumstanceswewillstillbeliabletopaythesebalancestoyouonpresentationofavalidclaim.
SCHEDULE 4: UNDERSTANDING OUR SERVICES AND RISKS
Thisnoticeisprovidedtoyou,asaretailclient,incompliancewiththeApplicableLaw.
Thisnoticecannotdisclosealltherisksandothersignificantaspectsoftheproductsdescribedbelow.Youshouldnotdealintheseproductsunlessyouunderstandtheirnatureandtheextentofyourexposuretorisk.Youshouldalsobesatisfiedthattheinvestmentissuitableforyouinthelightofyourownparticularexperience,objectivesandfinancialcircumstances.
Theremaybeacreditriskinvolvedwithanypersonsinvolvedinthedistributionofinterestsinaproductdescribedbelow,oranycounterpartytoaproductdescribedbelow,arisingfromthepotentialinsolvencyandcreditfailingofthosepersonsorcounterpartieswhichmayresultinpartof,orthefullamountofyourinvestmentnotbeingrepaidtoyou.
Althoughdifferentproductscanbeutilisedforthemanagementofinvestmentrisk,someoftheseproductsareunsuitableformanyinvestors.Differentinstrumentsinvolvedifferentlevelsofexposuretoriskandindecidingwhethertotradeinsuchinstrumentsyoushouldbeawareofthefollowingpoints.
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Youshouldalsounderstandthatindicationsofpastperformanceofaproductarenotareliableindicatoroffutureresults.
Bank Recovery and Resolution Directive
TheBankRecoveryandResolutionDirective(orBRRD)setsoutresolutiontoolsandpowersforBRRDResolutionAuthoritiesinrespectofBRRDEntitiesandwhensuchtoolsandpowerscanbeused.TheBRRDalsocontainslimitationsonEEAmemberstatescontributingpublicfinancestoabsorblossesorrecapitaliseBRRDEntities.TheuseofsuchtoolsandpowersandthelimitationsonuseofpublicfinancesmayaffectBRRDFinancialInstrumentsorliabilitiesorobligationsowedbyaBRRDEntity.Forexample,thevalueofBRRDFinancialInstrumentsmaybereducedtozeroand/orliabilitiesowedtoyoumaybeconvertedintoordinarysharesorotherinstrumentsofownershipforthepurposesofstabilisationandlossabsorptionandtheexerciseoftheresolutiontoolsandpowersmaylimitaBRRDEntity’sabilitytosatisfyliabilitiesorobligations(includingrepaymentobligations).ThetermsofexistingBRRDFinancialInstruments(e.g.dateofmaturityorinterestratespayable)couldbealteredandpaymentscouldbesuspended.
Wemayoffer,issue,orprovideadviceorotherservicesinrelationtoBRRDFinancialInstrumentsandliabilitiesandobligationsofBRRDEntitiesandindecidingtodealwithusgenerally,andinanyparticularcase,youshouldensurethatyouunderstandtheresolutiontoolsandpowersundertheBRRDwhichmaybeexercisedinrespectofaBRRDEntity,andthepotentialconsequencesonanyBRRDFinancialInstrumentorotherliabilityorobligationofaBRRDEntityoftheexerciseoftheresolutiontoolsandpowersundertheBRRD.Youshouldalsonotethat:(i)thetoolsandpowersundertheBRRDaresubjecttoEEAMemberStateimplementationandthatadditionalpowersandtoolsmayapplyinEEAMemberStates;and(ii)non-EEAequivalentsofBRRDEntities(fortheavoidanceofdoubt,thisincludescertaincompaniesintheCitigroupOrganisation)maybesubjecttoresolutiontoolsandpowersthataresimilar,andhaveequivalentconsequences,totheresolutiontoolsandpowersundertheBRRD.
1. Shares
1.1 Whenyoubuyorsubscribeforsharesissuedbyacompany,youarebuyingapartofthatcompanyandyoubecomeashareholderinit,whichusuallymeansyouhavetherighttovoteoncertainissues.Youcaneitherbuynewshareswhenthecompanysellsthemtoraisemoney(throughaninitialpublicoffering)orbuyexistingshareswhicharetradedonthestockmarket.
1.2 Theaimisforthevalueofyoursharestogrowovertimeasthevalueofthecompanyincreasesinlinewithitsprofitabilityandgrowth.Inaddition,youmayalsoreceiveadividend,whichisincomepaidoutofthecompany’sprofits.Longer-establishedcompaniesusuallypaydividendswhereasgrowingcompaniestendtopaylower,orno,dividends(withtheseashareholderwouldtypicallybehopingforbettercapitalgrowth).
1.3 Undernormalcircumstances,ashareholderinacompanyhasnorighttorequirethatcompanytoreturncapitaltoit.Unlessthecompanychoosestoreturncapitaltotheshareholder(forexample,byeffectingasharebuyback)orthesharescarryredemptionrightsexercisablebytheshareholder(whichisnormallynotthecase),theshareholder’sonlywaytorealiseitsinvestmentwillbetosellthesharestoanotherinvestor.Consequently,ashareholder’sreturnfrominvestingintheequitywilldependtoalargeextentonthemarketpriceoftheequitiesatthetimeofthesale.Themarketpriceofanequityisaffectedbythesupplyof,anddemandfor,thatequitywithinthemarket.Inturn,supplyanddemand(andthereforethevolatilityoftheshareprice)areaffectedbyanumberoffactorsincluding:
• domesticversusinternationalfactors–thevulnerabilityofthecompanytointernationaleventsormarketfactors.Thesewouldincludemovementsinexchangerates,changesintradeortariffpoliciesandchangesinotherstockorbondmarkets;
• sector-specificfactors–thesewouldincludedemandfortheproductthecompanyproduces,commodityprices,theeconomiccycleofindustry,changesinconsumerdemands,lifestylechangesandchangesintechnology;and
• company-specificfactors–thesewouldincludethecompany’sdirectors,thestrengthofthecompany’smanagementandthesignificanceofanykeypersonnel,thecompany’sprofithistory,thecompany’stangibleassetbase,debtlevelandfixedcoststructure,litigation,profitsorlossesonparticularcontracts,competition
fromwithinthesector,andwhetherthecompanyalreadyhasaprofitablebusinessorwhetheritisexploringforrecoverableresourcesorisdevelopinganewproduct.
1.4 Thelevelofastockmarketgoesupordownasthepricesofthesharesthataretheconstituentsofthatmarketgoupordown.Afactordeterminingthepriceofashareistheperceptionofitscurrentvaluetoitsowner.
1.5 Onefactorthatcouldaffectthepriceofashareisachangeinopinionastohowwellthecompanyitselfisperformingorcouldperforminthefuture.Thisopinionisfrequentlybasedonpredictionsabouttheeconomicconditionsinwhichacompanyisoperating,whichiswhyitmightseemthatstockmarketsgoupordowndependingoneconomicconditions.
1.6 Sharesaregenerallyafairlyvolatileassetclass–theirvaluetendstogoupanddownmorethanotherclassessuchasbondsandregulatedcollectiveinvestmentschemes.Ifyouareinvestinginshares,youshouldexpectthevalueofyourinvestmenttogodownaswellasup,andyoushouldbecomfortablewiththis.Holdingsharesishighrisk–ifyouhaveputallyourmoneyintoonecompanyandthatcompanybecomesinsolventthenyouwillprobablylosemost,ifnotall,ofyourmoney.
1.7 Intheshortterm,sharesmaygoupanddowninvalueandthiscanoccasionallybeverysignificant.However,ifyouhaveawiderangeofshares,itreducesthelikelihoodoflosingallormostofyourmoney.
1.8 Theliquidityofthesharesmaybeaffectedbywhetherthesharesarelistedorunlisted.Wheresharesareunlisteditmaybemoredifficulttodealinthemortoobtainreliableinformationabouttheirvalue(anditmaythereforebedifficulttoestablishapropermarketinthemforthepurposesofmakingasubsequentsale).
1.9 Onoccasionyoumayinvestinlistedshareinvestmentswheretheissuerproposestouseborrowingorotherformsofgearingtoenhancethereturnfororvalueofinvestmentsithasmadewithoutincreasingtheamountinvested.Thevalueofsuchinvestmentsmaybemorevolatilethantheunderlyinginvestmentsmadebytheissuerandmaybesubjecttosuddenandlargefallsinvalueand,ifthefallinvalueissufficientlylarge,thevalueoftheinvestmentmayfalltozero.
1.10 Ifacompanygoesintoliquidation,itsshareholdersrankbehindthecompany’screditors(includingitssubordinatedcreditors)inrelationtotherealisationanddistributionofthecompany’sassets–withtheresultthatashareholderwillnormallyonlyreceiveanymoneyfromtheliquidatorifthereareanyremainingproceedsoftheliquidationonceallofthecreditorsofthecompanyhavebeenpaidinfull.
1.11 Remember,asashareholderinthecompany,youcouldlosesomeorallofthemoneythatyouhaveinvestedintheshares.
2. Depositary Receipts
2.1 DepositaryreceiptsincludeAmericanorEuropeanDepositaryReceipts(ADRsorEDRs),GlobalDepositaryReceiptsorShares(GDRsorGDSs)orothersimilarglobalinstrumentsthatarereceiptsrepresentingownershipofsharesofaforeign-basedissuerheldintrustbyabankorsimilarfinancialinstitution.ThesesecuritiesaredesignedforUSandEuropeansecuritiesmarketsasalternativestopurchasingunderlyingsecuritiesintheircorrespondingnationalmarketsandcurrencies.Depositaryreceiptscanbesponsoredorunsponsored.Sponsoreddepositaryreceiptsarecertificatesinwhichabankorfinancialinstitutionparticipateswithacustodian.
2.2 Therisksofinvestingindepositaryreceiptsgenerallyreflecttherisksofthesecuritiesheldinthetrust.Theacquisitionanddisposalofsomedepositaryreceiptsislimitedtoround-lotsorround-lotmultiples.Depositaryreceiptsmaytradeinthesecondarymarketatpriceslowerthantheaggregatevalueofthecorrespondingunderlyingsecurities.Insuchcases,somedepositaryreceiptsenabletheholderstorealisetheunderlyingvalueofthesecuritiesbycancellingthereceiptandreceivingacorrespondingamountofunderlyingsecurities,whichrequiresthepaymentoffeesandexpenses.
3. Bonds
3.1 Abondisaloantoacompany,governmentoralocalauthority.Generally,interestispaidtoyouasthelenderandtheamountoftheloanrepaidattheendoftheterm.
3.2 Whenyoubuyorsubscribeforbonds,youbecomeacreditoroftheissuerofthebonds.Theissuermightbeagovernment
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oracorporatebusinessoritmaybeanentitythathasbeenformedspecificallyforthepurposesofissuingthebonds(thisisnormallythecasewherethebondspassthroughtoinvestorsthecashflowsgeneratedbyspecificassets,suchascorporateloans,residentialmortgagesorcreditcardreceivables).
3.3 Bondshaveanominalvalue.Thisisthesumthatwillbereturnedtoinvestorswhenthebondmaturesattheendofitsterm.
3.4 However,becausebondsaretradedonthebondmarket,thepriceyoupayforabondmaybemoreorlessthanthenominalvalue.Thereareseveralreasonswhythepricemightvaryfromthenominalvalue,forexample:
• Ifabondisissuedwithafixedinterestrateof,say,8%andgeneralinterestratesthenfallwellbelow8%,then8%willlooklikeagoodyieldandthemarketpriceofthebondwilltendtoriseabovethenominalvalue.
• Thereverseisalsotrue.Ifinterestratesrise,thefixedrateofaparticularbondmightbecomelessattractiveanditspricecouldfallbelowthenominalvalue.
• Ratingsagenciesmighttaketheviewthataparticularcompany’sbondnolongerqualifiesforahighrating–perhapsthecompanyisnotdoingaswellasitwaswhenthebondwasissued.Ifthishappensthenthemarketpriceofthebondmightfall.Ontheotherhand,thecompany’sratingmaybeimprovedwhichmayleadtoapricerise.
• Theinflationratemightstarttocreepupandtheinterestrateonsomebondsmightstarttolooklessattractivecomparedwithotherinvestments.
3.5 Therisksassociatedwithinvestinginbondsinclude:
• Interestraterisk–theriskthatbondpriceswillfallasinterestratesrise.Bybuyingabond,thebondholdermayhavecommittedtoreceivingafixedrateofreturnforafixedperiod.Shouldthemarketinterestraterisefromthedateofthebond’spurchase,thebond’spricewillfallaccordingly.Thebondwillthenbetradingatadiscounttoreflectthelowerreturnthataninvestorwillmakeonthebond.Marketinterestratesareafunctionofseveralfactorssuchasthedemandfor,andsupplyof,moneyintheeconomy,theinflationrate,thestagethatthebusinesscycleisinaswellasthegovernment’smonetaryandfiscalpolicies.
• Callrisk–theriskthatabondwillbecalledbyitsissuer.Callablebondshavecallprovisions,whichallowthebondissuertopurchasethebondbackfromthebondholdersandretiretheissue.Thisisusuallydonewheninterestrateshavefallensubstantiallysincetheissuedate.Callprovisionsallowtheissuertoretiretheold,high-ratebondsandselllow-ratebondsinabidtolowerdebtcosts.
• Defaultrisk–theriskthatthebond’sissuerwillbeunabletopaythecontractualinterestorprincipalonthebondinatimelymanner,oratall.CreditratingsservicessuchasMoody’s,Standard&Poor’sandFitchgivecreditratingstobondissues,whichhelpstogiveinvestorsanideaofhowlikelyitisthatapaymentdefaultwilloccur.
• Inflationrisk–theriskthattherateofpriceincreasesintheeconomydeterioratesthereturnsassociatedwiththebond.Thishasthegreatesteffectonfixed-ratebonds,whichhaveasetinterestratefrominception.Forexample,ifaninvestorpurchasesa5%fixedbondandtheninflationrisesto10%ayear,thebondholderwilllosemoneyontheinvestmentbecausethepurchasingpoweroftheproceedshasbeengreatlydiminished.Theinterestratesoffloating-ratebondsareadjustedperiodically,therebylimitinginvestors’exposuretoinflationrisk.
3.6 Bondscanbeboughtandsoldinthemarket(likeshares)andtheirpricecanvaryfromdaytoday.Ariseorfallinthemarketpriceofabonddoesnotaffectwhatyouwouldgetbackifyouholdthebonduntilitmatures.Youwillonlygetbackthenominalvalueofthebond(plusanycouponpaymenttowhichyouhavebeenentitledduringyourownershipofthebond),irrespectiveofwhatyoupaidforit.
3.7 Forsomebondstheremaybearestrictedmarketanditmaybemoredifficulttodealinthemorobtainreliableinformationabouttheirvalue(anditmaythereforebedifficulttoestablishapropermarketinthemforthepurposesofmakingasubsequentsale).
3.8 Somebondsgenerateareturnthatislinkedtothe
performanceofarealornotionalpoolofunderlyingassets.Insuchcircumstances,thereturnyoureceivewilldependupontheperformanceoftheunderlyingpool.Manystructuredproductstaketheformofbonds(seethe“StructuredProducts”sectionbelowforfurtherdetailsoftherisksassociatedwithstructuredproducts).
3.9 Asabondholderyoucouldlosesomeor(inextremecases)allofthemoneythatyouhaveinvestedinthebondsthatyouhold.
Convertible bonds
3.10 Somebondsareconvertibleorexchangeableintoaspecificnumberofanotherformofsecurity(usuallytheissuer’sordinaryshares)ataspecifiedpriceorratio.Acompanymayissueaconvertiblesecuritythatissubjecttoredemptionafteraspecifieddate,andusuallyundercertaincircumstances.Aholderofaconvertiblebondthatiscalledforredemptionwouldberequiredtotenderitforredemptiontotheissuer,convertittotheunderlyingequitiesorsellittoathirdparty.
3.11 Convertiblebondstypicallypayalowerinterestratethannonconvertiblebondsofthesamequalityandmaturity,becauseoftheconvertiblefeature.Thisstructureallowstheholderoftheconvertiblebondtoparticipateinsharepricemovementsinthecompany’sshares.Theactualreturnonaconvertiblebondmayexceeditsstatedyieldifthecompany’ssharesappreciateinvalueandtheoptiontoconverttosharesbecomesmorevaluable.
3.12 Convertiblebondstypicallytradeatpricesabovetheirconversionvalue,whichisthecurrentmarketvalueofthesharesreceiveduponconversion,becauseoftheirhigheryieldpotentialthantheunderlyingshares.Thedifferencebetweentheconversionvalueandthepriceofaconvertiblebondwillvarydependingonthevalueoftheunderlyingsharesandinterestrates.Whentheunderlyingvalueofthesharesdecline,thepriceoftheissuer’sconvertiblebondswilltendnottofallasmuchbecausetheconvertiblebond’sincomepotentialwillactasapricesupport.Whilethevalueofaconvertiblebondalsotendstorisewhenthepriceoftheunderlyingsharesrises,itmaynotriseasmuchbecausetheirconversionvalueismorenarrow.Thevalueofconvertiblebondsalsoisaffectedbychangesininterestrates.Forexample,wheninterestratesfall,thevalueofconvertiblebondsmayrisebecauseoftheirfixedincomecomponent.
4. Collective Investment Schemes
4.1 Acollectiveinvestmentscheme(“CIS”)isaschemewhichallowsaninvestortoinvestmoneyonapooledbasis(alongwithanumberofotherinvestors).ACISmaytaketheformofacompany,partnershiportrust.
4.2 Asaninvestor,youbuyshares/partnershipinterests/unitsintheCISinthehopethatthevaluerisesovertimeasthepricesoftheunderlyinginvestmentsincrease.Thepriceoftheshares/partnershipinterests/unitsdependsonhowtheunderlyinginvestmentsperform.
4.3 SomeCISsarecalled“open-ended”becausethenumberofshares/partnershipinterests/unitsinissueincreasesasmorepeopleinvestanddecreasesaspeopletaketheirmoneyout.“Closed-ended”CISsareCISswhereinvestorsareeitherunabletowithdrawtheirinvestmentsorcanonlydosoinveryrestrictivecircumstances.
4.4 Normally,thereisnoestablishedsecondarymarketinCISswhichmeansthatyourinvestmentinthemcannotusuallybesoldtothirdparties.However,(exceptforcertaintypesof“closed-ended”fund)theconstitutionaldocumentsoftheCISwillnormallyprovideforyoutobeabletoredeemyourinvestmentintheCISatitsnetassetvalue.Thefrequencywithwhichyoucanredeemyourinvestmentwilldependupontheprecisetermsofthoseconstitutionaldocuments.
4.5 AsaninvestorinaCIS,thevalueofanyinvestmentcangodownaswellasupandyoucouldlosesomeorallofthemoneythatyouhaveinvested.ThelevelofriskofaninvestmentinaCISwilldependontheunderlyinginvestmentsinwhichitisinvestedandhowwelldiversifiedtheCISis.
Forexample,aCISwhichinvestsonlyinoneindustrialsector,suchastechnology,willinvariablybemoreriskythanaCISthatinvestsacrossthewholerangeofcompaniesinamarket.Youshouldmaintainanappropriatelevelofemergencyfundstomeetunexpectedexpenses.
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4.6 PastperformanceofaCISisnotareliableindicatoroffutureresults.
4.7 Regulated CIS
4.7.1 SomeCISsareregulatedwhichmeansthattherearerulesabout(andlimitson)thetypesofunderlyinginvestmentsinwhichtheCIScaninvestandthefrequencyandpriceatwhichinvestmentsintheCIScanberedeemed.Inparticular,therulesapplicabletoregulatedCISslimittheextenttowhichtheycaninvestinderivativesorleveragetheirportfolios.RegulatedCISsincludeFCAauthorisedunittrusts,authorisedcontractualschemesandOEICs(open-endedinvestmentcompanies,whicharethesameasICVCs–InvestmentCompanieswithVariableCapital);UCITS;LuxembourgCSSFauthorisedSICAVs(Sociétésd’investissementàcapitalvariable);andFCPs(Fondscommunsdeplacement).
4.7.2 Investmentsinmutualfundsorunittrustsarenotinsuredbyanygovernmentagencyandarenotadepositorotherobligationof,orguaranteedby,anyCitigroupOrganisation,unlessspecificallystatedintheproductdocumentation.
4.8 Exchange-Traded Funds
4.8.1 Exchange-tradedfunds(orETFs)areCISswhichhaveanexchangelistingandforwhichthereisasecondarymarketontheexchangeonwhichthesharesarelisted.Therefore,unlikeothertypesoffund,profitsorlossesfromapositioninsharesintheETFcanberealisednotjustbyredeemingthesharesbutalsobysellingthemontherelevantexchange.Typically,ETFstrytoreplicateastockmarketindexsuchastheFTSE100ortheHangSengIndex,amarketsectorsuchasenergyortechnology,oracommoditysuchasgoldorpetroleum.
4.8.2 Thelegalstructurecanvary;however,themajorcommonfeaturesinclude:
• ETFshaveanexchangelisting;
• ETFsarenormallyindex-linkedratherthanactivelymanaged;
• thereisoftenanabilitytohandlecontributionsandredemptionsonanin-kindbasis(typicallyinlargeblocksofsharesonly);
• the‘value’oftheETF(butnotnecessarilythepriceatwhichitssharestrade–theycantradeata‘premium’or‘discount’tothe‘underlying’assets’value)derivesfromthevalueofthe‘underlying’assetscomprisingtheETF;and
• the‘underlyingassets’canbephysicalassetsorasyntheticassetforexampleaderivativegivingeconomicexposureonlytothe‘underlyingassets’.
4.8.3 EuropeanETFsaregenerallyregulatedCISs.ThepriceoftheETFsharesdependsontwomainfactors:
• thevalueoftheunderlyinginvestments;and
• thepopularity(orunpopularity)oftheETFsharesinthemarket.
4.8.4 TheresultisthatETFsharesdonotsimplyreflectthevalueoftheunderlyinginvestments,theyalsoreflecttheirpopularityinthemarket.Atanytimethesharepricemaybeatadiscountorpremiumtotheassetvalue.
4.8.5 SomeETFsborrowmoneytoinvest(toincreasethelevelexposuretotheunderlyingindex).Thisiscalledgearing.GearingimprovesanETF’sperformancewhenitsinvestmentsaredoingwell.Ontheotherhand,ifitsinvestmentsdonotdoaswellasexpected,gearinglowersperformance.AnETFthatisgearedisahigher-riskinvestmentthanonewhichisnotgeared(assumingthesameunderlyinginvestments).
5 Exchange Traded Notes (“ETNs”)
5.1 ETNs,asdebtinstruments,aresubjecttoriskofdefaultbytheissuer.Assuch,ETNshavetheirvaluedecidednotonlybytheperformanceoftheindextheyaredesignedtotrackbutalsobythecreditratingoftheissuer.Wheretheratingoftheissuerdeteriorates,thevalueoftheETNissuedbythatissuercouldfallinvalueeveniftheunderlyingindexdoesnot.InvestinginETNsisnotappropriateforinvestorswholacktheskillorresourcestoconsiderthecreditriskoftheissuerorwhoareunabletoacceptthatcreditrisk.
6. Exchange Traded Commodities (“ETCs”)
6.1 ETCsmaynotinvestinsecurities,inwhichcaseregulationsapplicabletosecuritiesdonotapplytosuchETCs.ETCs
maynotinvestincommoditiesdirectlybutincommodityderivativesinstead,inwhichcasethepriceofsuchanETCmaynottrackthespotpriceoftheunderlyingcommoditydirectly.InvestinginETCsisnotappropriateforinvestorswholacktheskilltoconsiderthesecharacteristicsofETCsorwhoareunabletoacceptrisksassociatedwithinvestinginETCs.
7. Derivatives
7.1 Options
7.1.1 Anoptiongivesthebuyeroftheoptiontheright(butnottheobligation)toacquireorsellanunderlyingsecurityorotherassetatafuturedateandatapricethathasalreadybeenagreedorthatisdeterminableinaccordancewithapre-agreedmechanism.
7.1.2 Buyingoptionsinvolveslessriskthanwritingoptionsbecause,ifthepriceoftheunderlyingassetmovesagainstyou,youcansimplyallowtheoptiontolapse.Themaximumlossislimitedtothepremium,plusanycommissionorothertransactioncharges.However,ifyoubuyacalloptiononafuturescontractandyoulaterexercisetheoption,youwillacquirethefuture.Thiswillexposeyoutotherisksdescribedinthe“Futures”sectionbelow.
7.1.3 Ifyouwriteanoption,theriskinvolvedisconsiderablygreaterthanbuyingoptions.Youmaybeliableformargintomaintainyourpositionandalossmaybesustainedwellinexcessofthepremiumreceived.Bywritinganoption,youacceptalegalobligationtopurchaseorselltheunderlyingassetiftheoptionisexercisedagainstyou,howeverfarthemarketpricehasmovedawayfromtheexerciseprice.Ifyoualreadyowntheunderlyingassetwhichyouhavecontractedtosell(whentheoptionswillbeknownas‘coveredcalloptions’),theriskisreduced.Ifyoudonotowntheunderlyingasset(‘uncoveredcalloptions’),theriskcanbeunlimited.
7.1.4 Theperformanceofanoptionthatyouhavewrittendependsprimarilyonhowtheunderlyingassetperformsduringthelifeoftheoption.Thevalueoftheoptioncan,therefore,beaffectedbyanyriskfactorsthatcanaffectthepriceoftheunderlyingassettowhichtheoptionrelates.Arelativelysmallmovementinthepriceoftheunderlyingassetcanresultinadisproportionatelylargemovement,unfavourableorfavourable,inthevalueoftheoption.Thepricesofoptionscan,therefore,bevolatile.
7.1.5 Ifyouwriteoptions,youmaysustainatotallossofanymarginyoudepositwiththecounterpartytoestablishormaintainaposition.Ifthemarketmovesagainstyou,youmaybecalledupontopaysubstantialadditionalmarginatshortnoticetomaintaintheposition.Ifyoufailtodosowithinthetimerequired,yourpositionmaybeliquidatedatalossandyouwillberesponsiblefortheresultingdeficit.
7.1.6 Evenifawrittenoptiontransactionisnotmargined,youmaystillcarryanobligationtomakefurtherpaymentsincertaincircumstancesoverandaboveanyamountpaidwhenyouenteredthecontract.
7.1.7 CertainLondonStockExchangememberfirmsunderspecialexchangeruleswriteaparticulartypeofoptioncalleda‘traditionaloption’.Thesemayinvolvegreaterriskthanotheroptions.Two-waypricesarenotusuallyquotedandthereisnoexchangemarketonwhichtocloseoutanopenpositionortoeffectanequalandoppositetransactiontoreverseanopenposition.Itmaybedifficulttoassessitsvalueorforthesellerofsuchanoptiontomanageitsexposuretorisk.
7.1.8 Certainoptionsmarketsoperateonamarginedbasis,underwhichbuyersdonotpaythefullpremiumontheiroptionatthetimetheypurchaseit.Inthissituationyoumaysubsequentlybecalledupontopaymarginontheoptionuptothelevelofitspremium.Ifyoufailtodosoasrequired,yourpositionmaybeclosedorliquidatedinthesamewayasafuturesposition.
7.1.9 Theinsolvencyordefaultofthecounterpartyoranyofthebrokersinvolvedwithyouroptiontransactionmayleadtopositionsbeingliquidatedorclosedoutwithoutyourconsent.Incertaincircumstances,youmaynotgetbacktheactualassetswhichyoulodgedascollateralandyoumayhavetoacceptanyavailablepaymentsincash.
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7.1.10 Onmanyexchanges,theperformanceofatransactionbytherelevantbrokeris‘guaranteed’bytheexchangeorclearinghouse.However,thisguaranteeisunlikelyinmostcircumstancestocoveryou,asthecustomer,andmaynotprotectyouifthebrokeroranotherpartydefaultsonitsobligationstoyou.Insomecircumstancesitispossible(andinsomecases,itmaybemandatory)touseaclearinghouseforcertaintypesof“over-the-counter”(“OTC”)instruments,althoughdependingontheparticularinstrumentthismaynotbepossibleoritmaynotbecommonplace.
7.1.11 OptionsmaybeexecutedonaninvestmentexchangeoronanOTCbasis.WhilesomeOTCmarketsarehighlyliquid,transactionsinOTCderivativesmayinvolvegreaterriskthaninvestinginon-exchangederivativesbecausethereisnoexchangemarketonwhichtocloseoutanopenposition.Itmaybeimpossibletoliquidateanexistingposition,toassessthevalueofthepositionarisingfromanOTCtransactionortoassesstheexposuretorisk.Bidpricesandofferpricesneednotbequoted,and,evenwheretheyare,theywillbeestablishedbydealersintheseinstrumentsandconsequentlyitmaybedifficulttoestablishwhatisafairprice.
7.2 Futures
7.2.1 Transactionsinfuturesinvolvetheobligationtomake,ortotake,deliveryoftheunderlyingassetofthecontractatafuturedate,orinsomecasestosettlethepositionwithcash.Theycarryahighdegreeofrisk.Theperformanceofafuturescontractdependsprimarilyonhowtheunderlyingassetperformsduringthelifeofthecontract.Thevalueofthefuturecanthereforebeaffectedbyanyoftheriskfactorsthatcanaffectthepriceoftheunderlyingassettowhichthefuturescontractrelates.
7.2.2 The‘gearing’or‘leverage’oftenobtainableinfuturestradingmeansthatasmalldepositordownpaymentcanleadtolargelossesaswellasgains.Italsomeansthatarelativelysmallmovementcanleadtoaproportionatelymuchlargermovementinthevalueofyourinvestment,andthiscanworkagainstyouaswellasforyou.Futurestransactionshaveacontingentliabilitywhichmeansthatyoumaybeliableformargintomaintainitspositionandalossmaybesustainedwellinexcessofthepremiumreceived.Byenteringintoafuturescontract,youacceptalegalobligationtopurchaseorselltheunderlyingasset,howeverfarthemarketpricehasmovedawayfromtheagreedprice.
7.2.3 Youmaysustainatotallossofanymarginyoudepositwiththecounterpartytoestablishormaintainaposition.Ifthemarketmovesagainstyou,youmaybecalledupontopaysubstantialadditionalmarginatshortnoticetomaintaintheposition.Ifyoufailtodosowithinthetimerequired,yourpositionmaybeliquidatedatalossandyouwillberesponsiblefortheresultingdeficit.
7.2.4 Theinsolvencyordefaultofthecounterpartyoranyofthebrokersinvolvedwithyourfuturestransactionmayleadtopositionsbeingliquidatedorclosedoutwithoutyourconsent.Incertaincircumstances,youmaynotgetbacktheactualassetswhichyoulodgedascollateralandyoumayhavetoacceptanyavailablepaymentsincash.
7.2.5 Onmanyexchanges,theperformanceofatransactionbytherelevantbrokeris‘guaranteed’bytheexchangeorclearinghouse.However,thisguaranteeisunlikelyinmostcircumstancestocoveryou,asthecustomer,andmaynotprotectyouifthebrokeroranotherpartydefaultsonitsobligationstoyou.Insomecircumstancesitispossible(andinsomecases,itmaybemandatory)touseaclearinghouseforcertaintypesofOTCinstruments,althoughdependingontheparticularinstrumentthismaynotbepossibleoritmaynotbecommonplace.
7.3 FuturesmaybeexecutedonaninvestmentexchangeoronanOTCbasis.WhilesomeOTCmarketsarehighlyliquid,transactionsinOTCderivativesmayinvolvegreaterriskthaninvestinginon-exchangederivativesbecausethereisnoexchangemarketonwhichtocloseoutanopenposition.Itmaybeimpossibletoliquidateanexistingposition,toassessthevalueofthepositionarisingfromanOTCtransactionortoassesstheexposuretorisk.Bidpricesandofferpricesneednotbequoted,and,evenwheretheyare,theywillbeestablishedbydealersintheseinstrumentsandconsequentlyitmaybedifficulttoestablishwhatisafairprice.
8. Structured Products
8.1 StructuredProductsareproductsstructuredtofulfilaparticulartradingormarketobjective.Astructuredproductmaycombinethefeaturesoftwoormorefinancialinstruments(forexample,abondandaderivative).Derivativesoftenconstituteanintegralpartofastructuredproduct.Theproductmayinvolveanelementofleverageandsoarelativelysmallmovementinthevalueoftherelevantunderlyingassetorindexmayhaveasignificanteffectonthevalueofthestructuredproduct.
8.2 StructuredproductsaregenerallynottradedonTradingVenuesandyoutaketheriskonthecounterpartyissuingthestructure.Thereistypicallynorecognisedmarketfortheseinvestmentsanditmay,therefore,bedifficultforyoutodealintheinvestmentortoobtainreliableinformationaboutitsvalueortheextentoftheriskstowhichitisexposed.
8.3 Some(butnotall)structuredproductsincludeanelementofcapitalprotection–however,youshouldbearinmindthatthisisnotaguaranteethattheamountinvestedwillbereturnedinallcircumstances.Thecapitalprotectionofferedistypicallysubjecttotheinvestmentbeinghelduntilmaturityandtothecreditworthinessoftheissuer.
8.4 Otherstructuredproductsdonotincludeanycapitalprotection,whichmeansthatyoucouldlosesomeoralloftheamountinvestedevenifyouholdtheproductuntilmaturityandeveniftheissuerremainscreditworthy.
8.5 Structuredproductsareoftenhigh-riskinvestmentsandyoucouldlosesomeorallofthemoneythatyouhaveinvestedinthem.Inaddition,someStructuredProductsmayalsoinvolvemorethanonecurrency,whichexposesyoutotheriskofadversechangesinexchangerates(see“ForeignExchange”sectionbelowinrelationtoforeignexchangerisks).
9. Foreign exchange
9.1 Engaginginforeignexchange(“FX”)trading(buyingonecurrencyinexchangeforanother)exposesyoutotheriskofadversechangesinexchangerates.
9.2 Exchangeratescanbevolatileandaredrivenbyavarietyoffactorsaffectingtheeconomiesofthejurisdictionswhosecurrenciesyouaretrading.
9.3 The‘gearing’or‘leverage’oftenobtainableinFXtradingmeansthatasmalldepositordownpaymentcanleadtolargelossesaswellasgains.Italsomeansthatarelativelysmallmovementcanleadtoaproportionatelymuchlargermovementinthevalueofyourinvestment,andthiscanworkagainstyouaswellasforyou.SomeFXtransactionsinvolveacontingentliabilitywhichmeansthatyoumaybeliableformargintomaintainyourpositionandalossmaybesustainedwellinexcessofthepremiumreceived.
9.4 Youmaysustainatotallossofanymarginyoudepositwithustoestablishormaintainaposition.Ifthemarketmovesagainstyou,youmaybecalledupontopaysubstantialadditionalmarginatshortnoticetomaintainyourposition.Ifyoufailtodosowithinthetimerequired,yourpositionmaybeliquidatedatalossandyouwillberesponsiblefortheresultingdeficit.
9.5 TheinsolvencyordefaultofthecounterpartyoranyofthedealersinvolvedwithyourFXtransactionmayleadtopositionsbeingliquidatedorclosedoutwithoutyourconsent.Incertaincircumstances,youmaynotgetbacktheactualassetswhichyoulodgedascollateralandyoumayhavetoacceptanyavailablepaymentsincash.
9.6 Ifyoubuyorsellcurrencywithus,wewillexecutethesetransactionsatspot(thatis,thepriceavailableinthemarketatthattime)orsamedayvalueunlessweagreeotherwise.
9.7 SpottransactionswillnormallybereadyforsettlementonthesecondBusinessDayafterdealing.
10. Non-readily realisable investments
10.1 Wemayadviseuponorenterintotransactionsinnon-readilyrealisableinvestments.
10.2 Thereisarestrictedmarketforsuchinvestmentsanditmaythereforebedifficulttodealinsuchinvestmentsortoobtainreliableinformationabouttheirvalue.Itcanbedifficulttoassesswhatwouldbeapropermarketpriceforthem.
10.3 Youmayhavedifficultysellingsuchinvestmentsatareasonablepriceand,insomecircumstances,itmaybedifficulttosellthematanyprice.
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10.4 Youmustnotinvestinthemunlessyouhavecarefullythoughtaboutwhetheryoucanaffordthemandwhethertheyarerightforyou.
11. Stabilisation
11.1 Weorourrepresentativesmay,fromtimetotime,recommendtransactionsinsecuritiestoyou,orcarryoutsuchtransactionsonyourbehalf,wherethepricemayhavebeeninfluencedbymeasurestakentostabiliseit.
11.2 Youshouldreadtheexplanationbelowcarefully.Thisisdesignedtohelpyoujudgewhetheryouwishyourfundstobeinvestedatallinsuchsecuritiesand,ifyoudo,whetheryouwish:
11.2.1 tobeconsultedbeforewecarryoutanysuchtransactiononyourbehalf;or
11.2.2 toauthoriseustocarryoutanysuchtransactiononyourbehalfwithoutfirsthavingtoconsultyou.
11.3 What is stabilisation?
11.3.1 Stabilisationenablesthemarketpriceofasecuritytobemaintainedartificiallyduringtheperiodwhenanewissueofsecuritiesissoldtothepublic.Stabilisationmayaffectnotonlythepriceofthenewissuebutalsothepriceofothersecuritiesrelatingtoit.Incertaincircumstancesstabilisationispermittedinordertohelpcounterthefactthat,whenanewissuecomesontothemarketforthefirsttime,thepricecansometimesdropforatimebeforebuyersarefound.
11.3.2 Wherestabilisationispermitted,stabilisationisbeingcarriedoutbya“stabilisationmanager”(normallythefirmchieflyresponsibleforbringinganewissuetomarket).Aslongasthestabilisingmanagerfollowsastrictsetofrules,theyareentitledtobuybacksecuritiesthatwerepreviouslysoldtoinvestorsorallottedtoinstitutionswhichhavedecidednottokeepthem.Theeffectofthismaybetokeepthepriceatahigherlevelthanitwouldotherwisebeduringtheperiodofstabilisation.
11.4 Thestabilisationrules:
11.4.1 limittheperiodwhenastabilisingmanagermaystabiliseanewissue;
11.4.2 fixthepriceatwhichtheymaystabilise(inthecaseofsharesandwarrantsbutnotbonds);and
11.4.3 requirethemtodisclosethattheymaybestabilisingbutnotthattheyareactuallydoingso.
11.5 Thefactthatanewissueorarelatedsecurityisbeingstabilisedshouldnotbetakenasanyindicationofthelevelofinterestfrominvestors,norofthepriceatwhichtheyarepreparedtobuythesecurities.
12. Emerging Markets/Country Risk
12.1 Theterm“emergingmarkets”referstofinancialmarketsofcountrieswhosepolitical,socialandeconomicinfrastructureisintheprocessofchangeanddevelopment.
12.2 Political,monetary,fiscalandeconomicconditionsmaybesubjecttorapidandunpredictablechange,whichmaygiverisetomuchgreatervolatilityofexchangerates,interestratesandsecuritiesvaluesthanistypicalofdevelopedeconomies.
12.3 Sovereign(country)riskconditionsmayarisewhere,throughlackofforeigncurrencyheldbythecentralbankorbecauseofpolitical,economicorotherevents,exchangecontrolscouldbeimposedwhichmaypreventtheconversionofemergingmarketcurrenciesintofreelyconvertiblecurrencies.Marketquotationsmaynotbereadilyavailableandinsomecircumstancescouldbeunobtainable.
12.4 Therelativelyhighinterestratestypicalofemergingmarkets’currenciesmayappeartopresentattractiveinvestmentopportunities.However,highinterestratesmaybeindicativeofaninflationaryeconomy,aweakeningexchangerateandpoliticalandeconomicuncertainty.
12.5 Investinginemergingmarketscarriesahigherriskthaninvestinginlargerestablishedmarkets.Investmentsinemergingmarketsarelikelytoexperiencegreaterrisesandfallsinvalueandtheremaybetradingdifficulties.Theserisksareevenmorepronouncedforinvestmentswhichrelatetosmallerormediumcompaniesinemergingmarkets.Investinginemergingmarketsisnotappropriateforinvestorswhoarenotabletoaccepttheserisks.
SCHEDULE 5: SUMMARY OF OUR BEST EXECUTION POLICY
PART 1: Scope and purpose
What is best execution and the purpose of the Best Execution Policy?
Whenweexecuteordersinfinancialinstrumentsonbehalfofclientsorreceiveandtransmitordersinfinancialinstruments,wehaveageneraldutytoactinaccordancewiththebestinterestsofourclients.Inaddition,asaspecificapplicationofthatgeneralduty,wearerequiredtotakeallsufficientstepstoobtainthebestpossibleresultforourclients(whichwerefertoas“best execution”).
Ourobligationtoachievebestexecutiondoesnotmeanthatwemustobtainthebestpossibleresultsforourclientsoneverysingleoccasion.Rather,itrequiresus:
• toverifyonanongoingbasisthatourexecutionarrangementsworkwellthroughoutthedifferentstagesoftheorderexecutionprocess;and
• totakeallappropriateremedialactionsifanydeficienciesaredetected.
Wehavedevelopedinternalprocessesandproceduresandanorderexecutionpolicy(the“Best Execution Policy”or“Policy”)toallowustoactinaccordancewithourclients’bestinterestsandobtainthebestpossibleresultforthemwhenexecutingorreceivingandtransmittingtheirordersinfinancialinstruments.
Werecognisetheimportanceofactinginaccordancewithyourbestinterestsandtakingallsufficientstepstoobtainthebestpossibleresultwhenexecutingordersforyou.Thisisimportantformaintaininganddevelopingourrelationshipwithyou.Westriveatalltimestoactfairlyandreasonablyindealingwithyou.
ThisdocumentsummarisesthePolicy.
When does the Best Execution Policy apply?
ThePolicyapplieswhereweareexecutingordersinfinancialinstrumentsonyourbehalforreceivingandtransmittingyourordersinfinancialinstruments.
ThePolicywillnotapplywhenwearenotexecutinganorderonyourbehalf,forexample,wherewearefollowingyourspecificinstructionstoexecuteyourorderinaparticularmannerorataparticularprice.Insuchascenario,thePolicywillnotapplytotheextentthatweaccepttheorderandfollowyourinstructionswhenexecutingtheorderoraspecificpartoftheorder.Similarly,thePolicywillnotapplytotheextentthatweacceptanorderfromyouandfollowyourspecificinstructionswhenplacingtheorderwith,ortransmittingtheorderto,anotherentityforexecution.SeePart3below.
ThisPolicywillapplytoalltransactionsinfinancialinstrumentsthatwearrangeonyourbehalf,whetherarrangedorexecutedthroughouraffiliatesorotherwise.
PART 2: Achieving best execution
What factors do we take into account to achieve best execution?
Inseekingtoachievebestexecution,wetakeintoaccountanumberoffactors.Theseinclude:
• price;
• costs;
• speed;
• likelihoodofexecutionandsettlement;
• size;
• nature;
• marketimpact;
• anyotherimplicittransactioncosts;and
• anyotherconsiderationrelevanttotheexecutionoftheorder.
Inrelationtoover-the-counter(“OTC”)products,wecheckthefairnessofthepriceproposedtoyoubygatheringmarketdatausedintheestimationofthepriceofsuchproductand,wherepossible,bycomparingwithsimilarorcomparableproducts.
What is the role of price?
Generally,asyouarearetailclient,thebestpossibleresultwillbedeterminedbythetotalconsiderationpaidbyyou,i.e.thepriceoftheinvestmentandallthecostsrelatedtotheexecution(includingexecutionvenuefees,clearingandsettlementfeesandanyotherfeespaidtothirdpartiesinvolvedintheexecutionoftheorder).
However,werecognisethattheremayfromtimetotimebecircumstancesforsomeclients,particularinstrumentsormarketswhereotherfactorsshouldhaveahigherprioritybecausetheyare
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instrumentalindeliveringthebestpossibleresultsintermsoftotalconsideration.Insuchcasestherelativeimportanceofeachofthefactorslistedabovewilldifferdependingon:
• thecharacteristicsofyourorder;
• thecharacteristicsofthefinancialinstrumentstowhichyourorderrelates;and
• thecharacteristicsofthevenuestowhichyourordercanbedirected(ifthereismorethanone).
PART 3: Compliance with client instructions
What happens if you give us specific instructions in relation to the execution of your order?
Whereyouprovidespecificinstructionsinrelationtotheexecutionofyourorderandweacceptthatorder,wewillfollowthoseinstructions.
Wewillsatisfyourbestexecutionobligationstoyouwhereweacceptandfollowyourspecificinstructionswhenexecutingorarrangingfortheexecutionofanorderoraspecificaspectofanorder,althoughthePolicymayapplytootheraspectsoftheordertotheextentthattheyarenotcoveredbyyourinstructions.Forexample,wewillsatisfyourbestexecutionobligationsinthefollowinginstances:
• whereyouinstructustoexecuteanorderforyouataparticularprice,wewillnotberesponsibleforchoosingthebestpriceforthetransaction;
• whereyouinstructustoexecuteyourorderonaparticularvenue,wewillnotberesponsibleforselectingthevenue;and
• whereyouinstructustoexecuteyourorderataparticulartimeoroveraparticularperiod,regardlessofthepriceavailable,wewillexecuteyourorderatthattimeoroverthatperiodinthebestpossiblemanner,butwillnotberesponsibleforthetimingoranyoftheconsequencesforpriceorotherfactorsthatresultsfromthetimingofexecution.
Any specific instructions you give to us in relation to orders may prevent us from taking the steps that we have designed and implemented as part of our Policy to obtain the best possible result for the execution of those orders in respect of the elements covered by those instructions.
PART 4: Choosing an execution broker or execution venue
WewillgenerallypassanorderontoanotherCitigroupentityorathirdparty(an“execution broker”)forthemtoexecute,asopposedtousexecutingyourorderourselves.
WherewepassyourordertoanexecutionbrokerbasedoutsidetheEuropeanEconomicArea,theymaynotbesubjecttobestexecution(orequivalent)requirements.Wemayneverthelesspassyourordertothemunlesseither(i)thecircumstancesrequireotherwiseor(ii)youexplicitlyinstructusotherwiseandweareabletofollowyourinstructionstouseanalternativeexecutionbroker.Ifwearenotabletofollowyourinstructions,wemaynotbeabletoacceptyourorder.
What factors are taken into account when determining which execution brokers we place orders with?
Factorsthatweconsiderinselectingtheexecutionbrokerswithwhichweplaceyourordersinclude:
• theircreditworthiness;
• theirmarketexpertise;
• thebreadthoftheirmarketcoverage;
• theexecutionvenuestheyuse;
• theirrelevancetoourclients;
• theirspeed;
• thecostoftheirservices;
• theirexecutionarrangementsandthequalityoftheirexecution;
• theregulatoryframeworktheyaresubjectto;and
• otherqualitativefactors(forexample,qualityofservice)asmayberelevant.
What factors are taken into account when determining the execution venue?
Factorsthatweconsiderwhenselectinganexecutionvenue(inthelimitedcircumstanceswherewemayexecuteyourorderourselves)orconsideringtheexecutionvenuesusedbyanexecutionbrokerinclude:
• thegeneralpricesavailable;
• thedepthofliquidity;
• therelativevolatilityinthemarket;
• thespeedofexecution;
• thecostofexecution;
• thereliabilityandcontinuityoftrading;
• thecreditworthinessofthecounterpartiesonthevenueorthecentralcounterparty;and
• thequalityandcostofclearingandsettlement.
How might factors vary between choices of execution broker or venue?
Insomemarkets,pricevolatilitymaymeanthattimelinessofexecutionisapriority.Inothermarketsthathavelowliquidity,thefactofexecutionmayitselfconstitutebestexecution.
Inothercases,ourchoicemaybelimitedbecauseofthenatureofyourorderoryourrequirements.Forexample,wheninvestmentproductsaremoreilliquid,theremaybelittle(orno)choice.
How often do we review our execution brokers and venues?
Wewillreviewandassess,onaregularbasis,whethertheexecutionbrokersandvenuesincludedinthePolicyprovidethebestpossibleresultsforourclientsorwhetherweneedtomakechanges.
How do we monitor our existing arrangements to ensure best execution?
Citimonitorsthequalityandappropriatenessofourorderexecutionarrangements(includingpricingandtheapplicationoftheexecutionfactors)inordertodetectpotentialdeficienciesandcircumstanceswherechangesmaybeappropriate.
Inthecaseoftransmissionofclientorders,thisincludesmonitoringthepassingofsuchordersandmonitoringthequalityofexecutionprovidedbytheexecutionbroker.Forexample,wehaveinplaceaprocesstocomparethepriceachievedforatransactionwiththepriceavailableinthemarketforthefinancialinstrumentatthetimeofexecution.Weseektomonitorinconsistenciesinordertoensurethequalityandappropriatenessofexecutionarrangements.Whereappropriatewewillseektoraisequerieswithexecutionbrokersastodiscrepanciesbetweentheexecutedandmarketprices.Wealsohaveregardto:
• pricesofferedfortheparticulartypeofinstrumentovertime;
• averagecostspertradechargedforthetypeoftradeovertime;and
• theBestExecutionPolicyof,andanybestexecutiondata,informationoranyotherguidanceprovidedby,therelevantexecutionbrokerfromtimetotime.
Wetakeasimilarapproachwithregardtoexecutionvenues.
InthecaseofOTCproducts,weregularlymonitorthefairnessofthepricingbygatheringmarketdataandcomparingthefinancialinstrumentwithcomparableproducts.
Where we have a choice of execution brokers or venues, how do we choose?
WewilltakeintoaccountfactorssuchasthecostsandbenefitsofaccessingmultipleexecutionbrokersorvenuesandaccessibilityindecidingwhichexecutionbrokerorvenuesweincludeinourPolicy.
IfwehaveaccesstomorethanoneexecutionbrokerorvenueinourPolicyforanorderinaparticularfinancialinstrument,wewillendeavourtochoosethebestexecutionbrokerorvenuefortheorder,takingintoaccountthefactorsapplicabletodeterminingexecutionbrokersorvenuesandachievingbestexecutionlistedabove.
Where can I find information on the top five execution brokers and venues used?
Wewillsummariseandmakepublic,onanannualbasis,foreachclassoffinancialinstruments,thetopfiveinvestmentfirmsintermsoftradingvolumeswherewetransmittedorplacedclientordersforexecutionintheprecedingyearandinformationonthequalityofexecutionobtained.Wherewehaveexecutedorders,wewillalsopublish,foreachclassoffinancialinstruments,thetopfiveexecutionvenuesintermsoftradingvolumeswhereweexecutedclientordersandinformationonthequalityofexecutionobtained.
ThisdatawillbeavailableonourwebsiteandinotherformatsfromyourRelationshipManager.
Whereavailable,wewillalsoprovidealinktothemostrecentexecutionqualitydatapublishedinaccordancewithApplicableLawforeachexecutionbrokerandvenuelistedinourBestExecutionPolicy.
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What execution brokers and / or venues do we use for particular investments?
Wehavesetoutbelowtheexecutionbrokersand/orvenuesweplacesignificantrelianceoninmeetingourobligationtotakeallsufficientstepstoobtainonaconsistentbasisthebestpossibleresultfortheexecutionofyourorders.
Itisimportanttonotethatwhenplacingordersinrespectofequities,AmericanDepositoryReceipts(“ADRs”),GlobalDepositoryReceipts(“GDRs”)andExchangeTradedFunds(“ETFs”)youwillberequiredtoselectanexecutionvenuefromalistofexecutionvenuesusedbytheexecutionbrokertowhomwepassyourorder.Theexecutionvenuesonthislistareonesthatwehavepre-selectedfromtheexecutionbroker’svenueoffering.
• Collective Investment Schemes
Whenwedealincollectiveinvestmentschemeswewilldealdirectlywiththefundmanagerortheirtransferagent.
• Equities, American Depository Receipts (“ADRs”), Global Depository Receipts (“GDRs”) and Exchange Traded Funds (“ETFs”)
Uponreceivingyourorder,Citiwilltransmityourordertoourexecutionbroker.WewilluseUBSAG,actingthroughitsbusinessgroupUBSInvestmentBankinSwitzerland(“UBS”)asourexecutionbrokerinrelationtoequities,ADRs,GDRsandETFs.Whenyouplaceanorderwithus,wewillaskyoutoconfirmwhichexecutionvenueyouwouldlikeUBStobedirectedtoexecuteyourorderon.Thepossibleexecutionvenuesaresetoutintheannextothisdocument.
Pleasenotethatwhilethefeeswechargeyouwillnotvaryonthebasisoftheexecutionvenueyouselect,thefeesthatUBSchargesmayvarydependingontheexecutionvenueselected.Feesofexecutionvenuesmayalsovary.FurtherinformationisavailablefromyourRelationshipManager.
PleasealsoseePart3above–thechoiceofexecutionvenuewillbeaspecificinstruction.
• Gilts and Bonds
Uponreceivingyourorder,Citiwilltransmityourordertoourexecutionbroker,UBS.UBSwillthenseektoexecuteyourorderontheappropriateexecutionvenue.Youwillnotberequiredtoselectanexecutionvenueunlessyouwishtodoso(inwhichcase,thisPolicymaynotapplytoyou–seePart3above).
• Structured Products
Whenwearrangeforyoutoinvestinastructuredproduct,wewillinstructouraffiliateCitigroupGlobalMarketsLimited(“CGML”)todealdirectlywiththerelevantproductissuer.Intheeventthatyouseekearlyredemptionofthestructuredproduct,wewillinstructCGMLtocontacttheissueroftheproductandobtainapricefortheproduct.
PART 5: Location of execution
Incertaincircumstances,thelawsandruleswearesubjecttomayspecifywhereanordercanbeexecuted(“trading obligations”).Tradingobligationsmayapply,irrespectiveofwhethertheirapplicationisconsistentwithourbestexecutionobligations.
ThePolicyprovidesforthepossibilitythatclientordersmaybeexecutedoutsideofaTradingVenue(subjecttocompliancewithanyapplicabletradingobligationsorotherapplicablelawsandrules).ATradingVenueisaregulatedmarket,multilateraltradingfacilityoranorganisedtradingfacility(inotherwords,broadly,venueswheremultiplethird-partybuyingandsellingtradinginterestsinteract).Wherewehavereceived,orsubsequentlyreceive,expressconsentfromyoutodoso(whichmaybegivenasastandingconsent)yourordersmaybeexecutedoutsideaTradingVenue(forexample,OTCexecution).
TheexecutionofordersoutsideaTradingVenuemayinvolveconsequenceswhichdifferfromexecutiononaTradingVenue.Forexample,thetransactionwillnotbesubjecttoanyrulesoftheTradingVenueintendedtoprovideforfairandorderlytrading.Additionally,theremaybeincreasedsettlementriskasthetransactionwillnotbecoveredbythesettlementrulesoftheTradingVenueandtheremaybedifferingexposuretocounterpartyrisk.Additionalinformationabouttheconsequencesofthismeansofexecutionisavailableonrequest.
PART 6: Client Limit Orders
ALimitOrdermeansanordertobuyorsellafinancialinstrumentatitsspecifiedpricelimitorbetterandforaspecifiedsize.
WhereCitihasacceptedaLimitOrderinrespectofsharesthathavebeenadmittedtotradingonaregulatedmarketortradedonaTradingVenue(asdefinedinPart5above),whichisnotimmediatelyexecutedunderprevailingmarketconditions,unlessyouexpresslyinstructotherwise,thatLimitOrdermayberequiredtobemadepublicimmediatelyinamannerwhichiseasilyaccessibletoothermarketparticipants.
However,wherewehavereceived,orsubsequentlyreceive,suchaninstructionfromyou(whichmaybegivenasastandinginstruction),weshallnotbeobligedtopublishaLimitOrderimmediatelyifitcannotbeimmediatelyexecutedunderprevailingmarketconditions(unlessinstructedotherwisebyyouinwritinginrespectofaparticularLimitOrderandweacceptthatLimitOrder).
PART 7: Reviewing the Policy
How often will we update the Policy?
WewillreviewthePolicyandourorderexecutionarrangementsannuallyandwheneveramaterialchangeoccursthataffectsourabilitytoobtainthebestpossibleresultsforourclients.WeshallmonitortheeffectivenessofthePolicyandassesstheexecutionbrokersandvenuesinthePolicyonaregularbasisandcorrectanyidentifieddeficiencies.
WeshallalsoseektoensurethatthedesignandreviewprocessofourinternalprocessesandproceduresandPolicyisappropriateandtakesintoaccountnewservicesorproductsofferedbyCiti.
WewillnotifyyouofanymaterialchangestoourorderexecutionarrangementsorthePolicy.
PART 8: Consenting to the Policy
WearerequiredtoobtainyourpriorconsenttothePolicyandyouwillbedeemedtoconsenttoitwhenyouplaceanorderwithus.
PART 9: Contact details
How do you contact us in connection with this Policy?
IfyouhaveanyqueriesaboutthePolicyorourcompliancewiththePolicy,pleasecontactyourRelationshipManager.
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Annex 1UBS’ execution venues in relation to equities, ADRs, GDRs and ETFs
SetoutbelowisthelistoftheexecutionvenueswhichmaybeavailableforyoutodirectUBStoexecuteyourordersoninrelationtoequities,ADRs,GDRsandETFs.WehaveselectedtheseexecutionvenuesoutoftheexecutionvenuesUBSusesonthebasisofthefactorsfordeterminingexecutionvenuessetoutabove:
Market Exchanges Equity ETF ADR / GDR
AUSTRALIA AX-AUSTRALIASE(ASX) Y Y
AUSTRIA VI-WIENERBORSE Y Y
BELGIUM BR-EURONEXTBRUSSELSSTOCKEXCHANGE Y Y
CANADA TO-TORONTOSTOCKEXCHANGE Y Y
V-TSXVENTUREEXCHANGE Y Y
FINLAND HE-HELSINKISTOCKEXCHANGE Y Y
FRANCE PA-EURONEXTPARISSTOCKEXCHANGE Y Y
GERMANY BE-BERLINSTOCKEXCHANGE Y Y GDR
D-DUSSELDORFSTOCKEXCHANGE Y Y GDR
DE-XETRA Y Y
F-FRANKFURTSTOCKEXCHANGE Y Y GDR
H-HAMBURGSTOCKEXCHANGE Y Y GDR
HA-HANNOVERSTOCKEXCHANGE Y Y GDR
MU-MUNCHENSTOCKEXCHANGE Y Y GDR
SG-STUTTGARTSTOCKEXCHANGE Y Y GDR
GREECE AT-ATHENSSTOCKEXCHANGE Y Y
HONGKONG HK-HONGKONGSTOCKEXCHANGE Y Y
IRELAND I-IRISHSTOCKEXCHANGE Y Y
ITALY MI-BORSAITALIANA Y Y
JAPAN T-TOKYOSTOCKEXCHANGE Y Y
NETHERLANDS AS-EURONEXTAMSTERDAMSTOCKEXCHANGE Y Y
NEWZEALAND NZ-NEWZEALANDSTOCKEXCHANGE Y Y
PORTUGAL LS-EURONEXTLISBONSTOCKEXCHANGE Y Y
SINGAPORE SI-STOCKEXCHANGEOFSINGAPORE Y Y
SPAIN MC-MADRIDSTOCKEXCHANGE Y Y
SWITZERLAND S-SWXSWISSEXCHANGE Y Y
VX-VX-VIRT-X Y Y
UNITEDKINGDOM LONDONSTOCKEXCHANGE(excludingAIM) Y Y GDR
UNITEDSTATESOFAMERICA A-AMERICANSTOCKEXCHANGE Y Y ADR
N-NEWYORKSTOCKEXCHANGE Y Y ADR
O-NASDAQ Y Y ADR
OB-NEWYORK-OTC Y Y ADR
P-NYSEARCA Y Y ADR
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SCHEDULE 6: YOUR REPRESENTATIONS
1.1 Representationsarepersonalstatements,assurancesorundertakingsgivenbyyoutousonwhichwerelywhenwedealwithyouandprocesstransactionsonyourbehalf.
1.2 YoumakethefollowingrepresentationsatthetimeyouenterintotheseTermsofBusinessandeverytimeyouplaceanorderwithustoenterintoanytransaction(an“Order”):
(a) youunderstandthatyouarenotunderanyobligationtobuyanyinvestment(s)throughusoranyCitigroupOrganisation.Youcantakeawayacopyofyourassetallocationand/orlistofinvestmentsmadeavailablebyuswithouthavingtoplaceanOrderandyouarefreetopursueadviceandexecuteyourinvestmentswithabrokeroradviserofyourownchoosing;
(b) wewillbeactingasyouragent,inoursolenameandwithoutprejudicetoanysecurityrightsrelatingtoanyinvestment;
(c) youhavemadeallenquiriesandreceivedalltheadvice(includingfinancialortaxadvice)youthinknecessarytoplaceanOrderinrelationtotheinvestment(s)towhichtheOrderrelatesandwhichmayincludetakinginvestmentadviceexceptwhereyouplaceanOrderonouradvice.WhereyouhaveanAdvisedAccountRelationshipourInvestmentAdvisoryServiceswillbeprovidedtoyouinaccordancewithPart2AoftheseTermsofBusiness;
(d) youacknowledgethatonceyouhavespokentoyourRelationshipManagerandconfirmed(a)thedetailsofanOrderand(b)thatyouhavereadallthedocumentationyouhavereceivedinconnectionwithyourOrder(includingtheseFundTerms)andwetheninitiateorstartprocessingyourorder,youmaynotbeabletocancelyourOrder.However,incertaincircumstancesinrelationtocertaininvestmentscancellationrightsmayapply.Wewillnotifyyouofthesewhenapplicable;
(e) youunderstandthatwemayrefuseyourOrderandthatthevalidityofanyOrderissubjecttothereceiptofclearedfundsbythefund,unittrustorcounterpartyrelatingtoyourOrder;
(f) youunderstandandacceptthatanydividendsreceivedbyusinrespectofyourOrdermaynotbepassedontoyou,butusedtopurchaseadditionalsharesorunitsinthefundorunittrustrelatingtoyourOrder;
(g) youconfirmthatyouarenotaUnitedStates(US)citizenorresidentorotherwiseaUSpersonforthepurposesoftheUnitedStatesSecuritiesAct1933,asamendedfromtimetotime,andyouacceptthatyourinvestmentsmaynotbeheldortransferredtoaUSpersonandyouagreetoinformusif,atanytime,youbecomeaUSperson;
(h) whereyourOrderrelatestofundsregisteredinIreland,youconfirmthatyouarenotanIrishtaxresidentandyouagreetoinformusif,atanytime,youbecomeanIrishtaxresident;
(i) youconfirmthattherearenoregulatoryimpedimentsinrelationtoyourcountryofresidenceorcitizenshipprohibitingyoufromplacinganOrderandyouagreetoinformusif,atanytime,yourcircumstancesinthisregardchange;
(j) whereyourOrderrelatestofundsorunittrustsregisteredinLuxembourg,youacknowledgethatthesharesorunitsofthefundorunittrustwillberegisteredinournameorthatofouragent,actingasyournominee.However,youconfirmthatyouunderstandthatyoumaydirectlyinvestinthefundorunittrustwithoutusingthenomineeserviceofferedbyusand,furthermore,youmayclaimadirectentitlementtoyoursharesorunitsregisteredinourname,whereitisactingasyournominee;
(k) youunderstandthatanyinterest,dividends,andotherincomeandcapitalgainsfromunitsorsharesinfundsorunittrustsmaybesubjecttotaxes,includingwithholdingtaxes.Youagreethatweandourappointednomineesoragentsmaywithholdtheamountofthesetaxesfrompaymentstoyou.Ifyouravailableassetswithusdonotcoverthetaxliability,youagreetoprovideusondemandwithanyadditionalfundsrequired;
(l) youacknowledgethat(exceptinrelationtoaPlan)we,and/oranynomineeoragentweappointinrelationtoyourOrder,arenotobligedtoinformyouofany
shareholdercommunicationswhichwe/theymayreceiveasashareholderorunitholderinafundorunittrustsnortakeanyactioninrelationtosuchcommunications,wherethisisapplicabletoyourOrder.Inparticular,weandourappointednomineesoragentswillnotbeobligedtoconsultyouinrelationtoexercisingthevotingrightsattachedtotheunitsorsharesinthefundorunittrustsinwhichyouinvestandshallhavecompletediscretionastowhethertoexercisesuchvotingrightsatall;and
(m)youacceptthatwedonotwarranttheperformanceorprofitabilityofyourOrderortherelevantfund(s)orunittrust(s).Youacceptthatyouaresolelyresponsibleforpayingtaxesorwithholdingtaxesarisingfromthepurchaseorsaleoftheunitsorsharesinfundorunittrusts.Inaddition,youunderstandthatwehavenoobligationtoreclaimforyouanyexcesstaxeswithheld.
1.3 IfyouhaveanyquestionsaboutthestatementsyouhavebeenaskedtoconfirmaboveorabouthowtheywillapplytoyourOrder,pleasecontactCition0800005500(oryourRelationshipManager,ifyouhaveanAdvisedAccountRelationship).
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SECTION TWO: Summary of Conflicts of Interest PolicyBackgroundCitiprovidesandisengagedinawiderangeoffinancialservices,includinginvestmentmanagement,privatebanking,financing,securitiestrading,corporateandinvestmentbankingandresearch.IncompliancewithourstatutoryobligationsthisdocumentdescribestheConflictsofInterestPolicy(the“Policy”)maintainedbyCitiinrespectofregulatedactivitiescarriedoutwithintheUKorEEA.
Citiiscommittedtomaintainingthehighestprofessionalstandardsandprinciplesinprovidingservicestoitsclients.Theinterestsofclientsmustalwayscomefirst,andCiti’spoliciesandprocedures,whichaddressandmanageconflictsofinterestasmayarise,areintendedtoensurethatthoseinterestsarewellserved.
Tothisend,Citihaspoliciesandproceduresinplacetoidentify,prevent,considerandmanagepotentialconflictsofinterestandprotecttheintegrityofitsrelationshipswithretail,professionalandeligiblecounterpartyclients.AllCitiemployeesmustcomplywithCiti’spoliciesandproceduresandtheymaynotdoindirectlyanythingthattheyareprohibitedfromdoingdirectlyunderthesepoliciesandprocedures.Thefollowingsectionsprovideasummaryoftheinternalpolicydocumentsandoperatingprocedures.Furtherdetailsonthesepoliciesandproceduresareavailableonrequest.
Forthepurposesofascertainingwhetherthereisaconflictofinterest,referencestoCitiemployeesincludereferencestootherpersonslinkedtousandourclientsandappointedrepresentativesofCiti.
Identification of conflictsCitiseekstoensureitisabletoappropriatelyandeffectivelyidentifyandpreventormanagepotentialconflictsofinterestbetweenus(includingourmanagers,employeesoranypersondirectlyorindirectlylinkedtous)andourclients,andbetweenourclients,thatariseinthecourseofprovidingourservicesandwhoseexistencemaydamagetheinterestsofaclient.
Itmaymanagepotentialconflictsthroughavoidance,establishinginformationbarriers(Chinesewalls)oractingwithanappropriatelevelofindependence.WherethearrangementsunderourConflictsofInterestPolicytopreventormanageaparticularconflictarenotsufficienttoensurewithreasonableconfidencethattheriskofdamagetoaclient’sinterestswillbeprevented,wewillprovidetheclientwithaspecificdescriptionoftheconflictsofinterestandexplainthegeneralnatureand/orsourcesoftheconflictsofinterest,aswellastherisksthatariseasaresultoftheconflictsofinterestandthestepstakentomitigatethoserisks.Thespecificdescriptionwillbeinsufficientdetailtoenabletheclienttomakeaninformeddecisionastowhethertoproceed.
Indeterminingwhetherthereisormaybeaconflictofinterestwhoseexistencemaydamagetheinterestsofaclient,Cititakeintoaccount,amongstotherthings,whetherCitiorCitipersonnel:
– islikelytomakeafinancialgain,oravoidafinancialloss,attheexpenseoftheclient;
– hasaninterestintheoutcomeofaserviceprovidedtotheclientorofatransactioncarriedoutonbehalfoftheclient,whichisdistinctfromtheclient’sinterestinthatoutcome;
– hasafinancialorotherincentivetofavourtheinterestofanotherclientorgroupofclientsovertheinterestsoftheclient;
– carriesonthesamebusinessastheclient;
– receivesorwillreceivefromapersonotherthantheclient,aninducementinrelationtoaserviceprovidedtotheclientintheformofmonetaryornon-monetarybenefits.
Citi has identified that potential conflicts of interest between Citi and clients arise in the following general categories:
– Conflicts relating to treating clients fairly;forexample,whensellinginvestments,CitimayreceiveinducementsfromfundcompaniesandsecurityissuerswheresuchinducementsarepermittedunderApplicableLaw,including:
a)turnover-relatedsalesfollow-upcommissions,paidtousbyfundcompaniesfromthemanagementfeestheyreceive;
b)salescommissionspaidbysecurityissuersintheformofplacementcommissions;
c)correspondingmarkdownsontheissueprice(discount/rebate)andsalesfollow-upcommissions;
d)up-frontfeespaidtoCiti,insofaraswelevythesewhensellinginvestmentunitsorothersecurities;and
e)non-monetaryinducements.
Citimayalsoprovidesuccess-relatedcommissionsandfixedremunerationstocontractuallyindependenttiedagentswholeadustoclientsortransactionswithorwithoutreferencetoaspecifictransactionwherepermittedunderApplicableLaw.
– Conflicts relating to competing with clients; forexample,Citimayseektomakeinvestmentsforitsownaccountinsecuritiesinwhichourclientsarealsoseekingtoinvest.
– Multiple involvement; forexample,CitimayactastrusteetoinvestorsonadebtsecurityandalsoactasalendertothesecurityissuersuchthatitmaycreateaconflictofinterestbetweenCiti’sobligationsastrusteeandCiti’sproprietaryinterests.
– Conflicts relating to use of material non-public information or use of private information;forexample,Citimaysellsecuritiestoclientsatatimewhenithasaccesstoprivateinformationregardingthedebtorinconnectionwithitslendingoradvisorybusiness.
– Conflicts relating to manufacturing of products; forexample,CitimaydevelopaproductthatenablesCititosellitsownexposureinanentitytoitsclients.
– Conflicts between clients or groups of clients; forexample,Citimayprovideadvisoryservicestoaclientonatransactionandatthesametimeprovidefinancingtoanotherclientonthesametransactionwherethetwoclientshaveseparateand/orcompetinginterests.
– Conflicts between Citi employees and the interests of Citi or the interests of clients; forexample,aCitiemployeemayhaveapersonalinvestmentinanissuerofsecuritiesandalsoprovideinvestmentrecommendationstoclientsonthatsameissuerofsecurities.
Management of conflictsAlthoughnotanexhaustivelist,theprimarymethodsthatmaybeusedbyCititomanageactualorpotentialconflictsofinterestinclude:
– Citi,underthedirectresponsibilityofthemanagementboard,operatesanindependentComplianceDepartment,witharemittomonitortheidentification,prevention,avoidanceandthemanagementofconflictsofinterest;
– proceduresandsystemstoidentifyspecificsituationswheretherearecompetingoradverseinterests;
– procedurestopreventorcontroltheexchangeofinformationbetweenCitipersonnelengagedinactivitiesinvolvingariskofconflictofinterestwheretheexchangeofthatinformationmayharmtheinterestsofoneormoreclients;
– tradesurveillanceandrestrictionsystemsincludinginsider,andrestricted(orfreeze)liststomonitortheflowofinsideinformationwithinthefirmandprohibitemployeesfrommisusingsuchinformationforthefirm’sortheirownaccountandtothedetrimentofclients;
– oversightandapprovalbyproductcommittees,independentfromthedirectlyinvolvedCitirepresentatives,covering(amongothermatters)transactionandproductpricing,placing,andstructure;
– structuralseparation.Suchseparationmaybephysicalorotherwise,includingbutnotlimitedtoinformationbarriers,compensationarrangementsandormanagementandsupervisorystructures;
– oversightofcontactsbetweenandwithinbusinesseswhoseclientshaveadverseorcompetinginterestswiththeclientsofotherbusinessunits;
– separatesupervisionofCitipersonnelwhoseprincipalfunctionsinvolvecarryingoutactivitiesonbehalfof,orprovidingservicesto,clientswhoseinterestsmayconflict,orwhootherwiserepresentdifferentintereststhatmayconflict,includingthoseofCiti;
– removalofanydirectlinkbetweentheremunerationofCitipersonnelprincipallyengagedinoneactivityandtheremuneration
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of,orrevenuesgeneratedby,differentCitipersonnelprincipallyengagedinanotheractivity,whereaconflictofinterestmayariseinrelationtothoseactivities;
– measurestopreventorlimitanypersonfromexercisinginappropriateinfluenceoverthewayinwhichCitipersonnelcarryoutinvestmentorancillaryservicesoractivities;
– measurestopreventorcontrolthesimultaneousorsequentialinvolvementofCitipersonnelinseparateinvestmentorancillaryservicesoractivitieswheresuchinvolvementmayimpairthepropermanagementofconflictsofinterest;
– policiesandproceduresensuringfairand/orequaltreatmentofclientsorclassesofclients;
– regulationofpersonalinvestmentandbusinessactivitiesofCitiemployeesbytheComplianceDepartmenttopreventconflictsofinterestarisingagainsttheinterestsofclients;
– trainingofemployees;
– rulesgoverningtheacceptanceandgrantingofinducements,includingdisclosureofsucharrangementstoclients;
– thegeneralorspecificdisclosureofconflictsofinteresttoclientswherenecessary,includingbutnotlimitedto,instanceswhereitisnotconsideredpossibletohavesufficientarrangementstoavoidorwhollymanageaconflictofinterest;and
– decliningtoactwherewebelievethereisnootherpracticablewayofensuringthatyouandourotherclientsaretreatedfairly.WemayalsoestablishorganisationalwallstorestrictthemovementofinformationwithinCitigroupOrganisations.
Ifyousorequest,wewillbepleasedtoprovidefurtherdetailsontheprinciplesoutlinedabove.
Reviewing the PolicyHow often will we update the Policy?
WewillmonitortheeffectivenessofthesearrangementsandimplementanynecessarychangestoourConflictsofInterestPolicyfromtimetotime,andwillnotifyyouofanymaterialchanges,wheretheyarerelevanttoyou.
Contact detailsHow do you contact us in connection with the Policy?
IfyouhavequeriesaboutthePolicyorourcompliancewiththePolicy,pleasecontactyourRelationshipManager.
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