appendix for overseas securities trading
TRANSCRIPT
APPENDIX FOR OVERSEAS SECURITIES TRADING
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Version: October 2018 (Institutional Clients)
APPENDIX FOR OVERSEAS SECURITIES TRADING
This Appendix applies in respect of securities trading services in Overseas Securities provided by
ICBCIS to the Client, in addition to the General Terms and Conditions, the Appendix for Securities
Trading, and the Appendix for Margin Accounts.
In the event that there is any inconsistency between this Appendix and the General Terms and
Conditions, the Appendix for Securities Trading, and/or the Appendix for Margin Accounts, the
provisions in this Appendix shall prevail in respect of trading in Overseas Securities.
Unless otherwise defined in this Appendix, terms defined in the "Definitions and Interpretation"
section of the Standard Terms and Conditions shall have the same meaning when used in this
Appendix.
Reference to "Appendix" shall include the Annexures.
1. DEFINITIONS AND INTERPRETATION
1.1 In this Appendix, the following terms shall have the following meanings:
"Account(s)" as referred to in this Appendix refers to any or more of the Securities Account,
Margin Account and such other accounts that the Client maintains with ICBCIS from time to
time, in respect of securities trading services in Overseas Securities provided by ICBCIS to the
Client.
"Applicable Laws" mean all relevant or applicable laws, rules, regulations, by-laws,
constitution, orders, directives, notices, circulars, codes, customs, contractual terms prescribed
by any Clearance Systems and/or Exchanges and usages (whether of government bodies,
authorities, Exchange, market, regulators, self regulatory bodies, Clearance System, whether
or not having the force of law, and whether in or outside Hong Kong), as may be promulgated
from time to time.
"Clearance System" means any Clearing House, settlement system, payments system, or
depository (including any dematerialized book entry system or entity that acts as a system for
the central handling of Overseas Securities in the country where it is incorporated or organized
or that acts as a transnational system for the central handling of Overseas Securities), whether
or not acting in that capacity, or other financial market utility or organized trading facility used
in connection with Transactions and any nominee of the foregoing.
"Extension of Credit" includes but is not limited to any daylight and overnight overdraft or
similar advances, any reimbursement demands as provided herein, and uncommitted overdraft
lines or similar uncommitted lines provided by ICBCIS to the Client in connection with the
Instructions or Transactions in respect of Overseas Securities or services hereunder.
"Required Amount" is as defined in Clause 2.9 below.
"Taxes" means all taxes, levies, imposts, charges, assessments, deductions, withholdings and
related liabilities, including additions to tax, penalties and interest imposed on or in respect of
(i) Overseas Securities or cash in the Account (including all payments made by ICBCIS to the
Client in connection with any such Overseas Securities or cash), (ii) the Transactions effected
under this Appendix (including stamp duties or financial transaction tax), or (iii) the Client;
and "Tax" means any of them.
2. INSTRUCTIONS AND TRANSACTIONS
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2.1 ICBCIS is authorized but not obliged to act on an Instruction given or purported to be given by
the Client. Instructions may only be given by the Client in such manner or form and during
such time(s) as notified by ICBCIS to the Client, and which ICBCIS may at any time amend,
vary or restrict from time to time. The Client shall comply with the security procedures
required by ICBCIS from time to time, to establish the origination of the communication and
the authority of the person sending any communication.
2.2 The Client agrees that the Client and the persons who make investment decisions on behalf of
the Client are responsible for investment decisions in the Client's account, including whether
to buy, hold, or sell any particular Overseas Security. The Client shall be obliged to monitor
and stay informed about the Client's Overseas Securities holdings and respond to change as the
Client deems appropriate.
2.3 The Client undertakes to provide ICBCIS timely and accurate information relating to any
restrictions on the sale or transfer of any Overseas Securities held in the Account. In respect
of any Instructions to sell or transfer Overseas Securities, the Client shall upon request provide
ICBCIS with any necessary documents to the satisfaction of ICBCIS to satisfy any and all
legal transfer requirements under the Applicable Laws. The Client shall be responsible for and
shall reimburse ICBCIS for all costs associated with such transfers including those associated
with any delays, expenses, losses and damages incurred by ICBCIS that are associated with
compliance or failure to comply with any of the relevant requirements concerning such sale or
transfer.
2.4 Where ICBCIS requires information and documents from the Client within a specified
timeframe and the Client fails to respond within such timeframe, the Client acknowledges that
it may result in ICBCIS being unable to act on an Instruction.
2.5 Unless the Client specifies otherwise, any Instruction for the sale or purchase of Overseas
Securities is good for the day in the market where the Instruction is to be executed, and if the
date of such Instruction is a public holiday in the relevant market, the Client agrees such
Instruction may be executed in the relevant market on the first working day thereafter. Any
Instruction for the sale or purchase of Overseas Securities for execution on the date of
Instruction must be received by ICBCIS before the relevant cut-off time as notified by ICBCIS
to the Client from time to time.
2.6 If for any reason any Instruction has not been executed (or any unexecuted part of any such
Instruction in the case of a partially executed Instruction), it shall be deemed to lapse at the
expiry of the trading date specified in the Instruction, or if no such date is specified, the later
of the date of the Instruction or the first working day thereafter in the market where the
Instruction is to be executed if it is a public holiday in that market on the date of Instruction.
Any other Instructions shall be effective until cancelled by the Client and accepted by ICBCIS.
2.7 Notwithstanding any contrary provisions in the Agreement, ICBCIS shall have the right,
exercisable at its sole and absolute discretion to immediately close out any transaction
executed in error for any reason ("error transactions"). The Client hereby agrees that to the
maximum extent permitted under applicable law and not inconsistent with the applicable
obligations of ICBCIS under the Code in respect of the services in Securities under the
Agreement, ICBCIS shall not be responsible for any losses, costs and expenses (if any) that
arise from any error transactions which shall be borne by the Client absolutely, and that
ICBCIS shall not be required to account to the Client, and shall be entitled to retain any profits,
gains and income (if any) made in connection with such error transactions.
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2.8 Unless otherwise agreed by ICBCIS and subject to such terms as prescribed by ICBCIS, the
Client shall not place any Instruction to short sell Overseas Securities (i.e., Overseas Securities
that the Client does not own).
2.9 Without prejudice to any provisions herein, in respect of each Instruction, the Client shall on
demand place into the Account cleared funds in the amount and currency as ICBCIS so
requires and Overseas Securities in the amount and form as ICBCIS so requires, to enable
ICBCIS to discharge any liability incurred or to be incurred in connection with any Instruction
or Transaction effected or to be effected for the Client (including but not limited to tax, duty,
other fees, costs and expenses in connection therewith) (the "Required Amount"). The Client
agrees that:
(a) the Client shall not, until completion of the Transaction, be entitled to withdraw or in
any way deal with all or any part of the Required Amount in the Account;
(b) ICBCIS shall be entitled to debit the Account (or if sufficient funds are not available
in the Account, any other Account of the Client with ICBCIS) with the Required
Amount on or (at the sole discretion of ICBCIS) at any time before completion of the
Transaction; and
(c) ICBCIS shall be entitled to set-off over an amount equivalent to the Required Amount
(in any currency) available in the Account (in the form of credit balance and/or credit
facility) against all actual or contingent liabilities incurred by ICBCIS as a
consequence of the said Instruction and Transaction, including any liability to pay the
purchase price and all related interests, fees, costs and expenses; to deliver the
Overseas Securities; and/or to meet such other obligations to satisfy settlement or
margin requirements in relation thereto.
2.10 Subject to Clause 2.11 below, ICBCIS shall have the right (but not the obligation) to decline
an Instruction unless:
(a) there are sufficient Overseas Securities and sufficient immediately available monies in
the required currency credited to the Account of the Client as necessary to meet the
Required Amount in full on a timely basis or at such time(s) as notified by ICBCIS
from time to time; or
(b) there are sufficient available Extension of Credit facilities to meet the Required
Amount in full on a timely basis or at such time(s) as notified by ICBCIS from time to
time, and provided that ICBCIS is satisfied that all terms and conditions relating to
such facilities have or will have been met in full.
2.11 Notwithstanding any of the aforesaid, ICBCIS may at its discretion act on an Instruction
despite that there are insufficient Overseas Securities or funds in the required currency in the
Account or there is lack of prearranged Extension of Credit facilities. The Client shall be
responsible to repay any outstanding amount, debit or overdraft to the relevant Account
(including any interest charged by ICBCIS) in connection thereto subject to the terms of the
Agreement.
3. FOREIGN CURRENCY EXCHANGE; EXTENSION OF CREDIT AND
REIMBURSEMENT
3.1 If there are insufficient funds in the Account in the currency in which the Transaction is to be
settled by such time as ICBCIS requires, ICBCIS is authorized but not obliged to effect such
currency exchange converting cash held in the Account into the required currency (at such
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exchange rate as ICBCIS shall determine at the relevant time) to satisfy the Required Amount.
ICBCIS will accordingly debit the Client's Account to process foreign exchange and credit the
Client's Account with the required currency.
3.2 Without prejudice to the foregoing, if ICBCIS receives Instructions that would result in the
delivery of Overseas Securities or payment of monies in a required currency exceeding the
amount of Overseas Securities or monies in the relevant currency in the Account of the Client,
ICBCIS may at its discretion:
(a) effect any cash payment or other funds transfer and/or create or increase an Extension
of Credit to the Client including any overdraft;
(b) make partial deliveries or payments consistent with market practice; or
(c) suspend or delay in acting on any Instruction until there are sufficient required
Overseas Securities or cash in the required currency in the Account.
3.3 The Client agrees and acknowledges that any Extension of Credit to the Client hereunder will
be uncommitted and at the sole discretion of ICBCIS, and the Client agrees that it shall repay
any Extension of Credit upon demand by ICBCIS. The Client agrees that ICBCIS may elect at
any time to make any debit balance or other obligation of the Client's Account immediately
due and payable. ICBCIS may report any past due amounts to a consumer and/or securities
credit reporting agency and may take measures necessary (including but not limited to
engaging debt collection agents) to collect past due amounts. ICBCIS will charge interest on
any Extension of Credit at a rate as notified to the Client from time to time. ICBCIS may at
any time cancel or refuse any Extension of Credit. No prior action or course of dealings by
ICBCIS with respect to any Extension of Credit to effect any settlement of any Transaction or
Instruction will obligate ICBCIS to provide any other Extension of Credit with regards to any
subsequent settlement of any Transaction or Instruction.
3.4 ICBCIS may at its discretion decide the currency in which the Extension of Credit is granted
("Credit Currency") (which may or may not be the same as the currency in which the
Transaction is to be settled ("Settlement Currency")) and the currency in which the
repayment shall be made to ICBCIS ("Repayment Currency"). If ICBCIS decides to provide
the Extension of Credit in a Credit Currency other than the Settlement Currency, ICBCIS will
determine the amount of Extension of Credit in the Credit Currency (at such exchange rate for
converting the Credit Currency into the Settlement Currency as ICBCIS shall determine at the
relevant time). When the Extension of Credit is due and if there are insufficient funds in the
Account in the Repayment Currency, ICBCIS is authorized but not obliged to effect such
currency exchange converting cash held in the Account into the required Repayment Currency
(at such exchange rate as ICBCIS shall determine at the relevant time) to settle repayment to
ICBCIS. ICBCIS will accordingly debit the Client's Account to process foreign exchange and
credit the Client's Account with the required currency.
3.5 (Applicable to Margin Accounts) The Client shall on demand by ICBCIS make payments of
deposits or Margin in cash or Overseas Securities acceptable to ICBCIS, as the case may be, or
otherwise in amounts, forms and currencies as agreed with ICBCIS from time to time, or
which may be required by the rules of any Exchange or relevant market, or for other reasons
including but not limited to fluctuations in prices of Overseas Securities and/or currency
exchange rates for any currency.
3.6 The Client shall on demand by ICBCIS reimburse ICBCIS in respect of any irrevocable
commitment incurred in carrying out Instructions to clear and/or settle Transactions for the
Client hereunder (including failure costs payable by ICBCIS if the Client were to fail to
deliver any required currency or Overseas Securities). Irrevocable commitments are incurred
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on the date ICBCIS or its Agent(s) become irrevocably obligated to a Clearance System or
other person for the delivery of Overseas Securities or payment of cash even if the Account
has insufficient Overseas Securities or cash in the required currency on the applicable
settlement date. The Client agrees that its reimbursement obligation arises when the
irrevocable commitment is incurred by ICBCIS or its Agent(s) despite the actual settlement or
maturity date. The Client agrees that after ICBCIS has made a demand for reimbursement by
the Client, ICBCIS may debit the Client for the amount ICBCIS or its Agent(s) will be
obligated to pay with regards to the irrevocable commitment, whether or not that debit creates
or increases any overdraft by the Client.
3.7 The Client agrees that it assumes the risks associated with holding or effecting Transactions in
cash denominated in any currency including any events or laws that delay or adversely affect
transferability, convertibility or availability of any currency, appropriation of seizure, any
devaluation or redenomination of any currency, or fluctuations or changes in foreign exchange
rates.
3.8 ICBCIS may net or set-off Transactions when effecting currency exchange transactions
hereunder. ICBCIS and/or its Agent(s) may be compensated in part from the spread taken on
currency exchange and ICBCIS and/or its Agent(s) or Affiliates may act as principal in any
currency exchange. Unless otherwise provided in the Applicable Laws, neither ICBCIS nor its
Agent(s) or Affiliates assumes any fiduciary or other duty by virtue of effecting a currency
exchange transaction, nor are they acting as trustee.
3.9 The Client agrees and acknowledges that ICBCIS may not be able to process any foreign
currency exchange on a non-banking day in Hong Kong and/or the relevant jurisdiction(s) or
due to any unforeseen circumstances. The Client agrees and acknowledges that ICBCIS shall
not be responsible for any losses, expenses or costs incurred as a result.
4. SECURITIES AND CASH IN THE ACCOUNT
4.1 The Client expressly authorizes ICBCIS to establish and maintain one or more custody
account(s) (omnibus account in its name or otherwise) with any custodian, depository or Agent
as ICBCIS may appoint to receive, hold and maintain any Overseas Securities, related assets
and proceeds of the Transactions. The Client hereby expressly authorizes ICBCIS to deposit
any Overseas Securities, related assets and proceeds of Transactions with any custodian,
depository or Agent appointed by ICBCIS in a collective custody account or otherwise in
ICBCIS's name but for the account and at the risk of the Client. Unless otherwise agreed by
ICBCIS and the Client, any such Overseas Securities and assets shall be held in the relevant
overseas jurisdiction and any transfer or delivery of such Overseas Securities and assets from
one jurisdiction to another shall be at the expense and risk of the Client.
4.2 The Client acknowledges that in certain markets, the rules of the Clearance System may
require an account to be opened at a Clearance System in the name of ICBCIS or the Client.
The Client also acknowledges that the Overseas Securities may be held in the name of a
custodian, a nominee of the custodian or its sub-custodian or a nominee of the Clearance
System as may be required by that Clearance System.
4.3 The Client authorizes ICBCIS to make or accept payment for or delivery of Overseas
Securities at such time and in such form and manner as is in accordance with the Applicable
Laws of the relevant jurisdiction and/or with the practice and customs prevailing in the
relevant market. The Client acknowledges that proceeds (including cash and Overseas
Securities) from Transactions are processed in accordance with the trading hours and practice
of the relevant market and may not be accessed or withdrawn from the Account by the Client
until the same are received by ICBCIS.
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4.4 ICBCIS may, but is not obligated to, credit cash to the Account before a corresponding and
final receipt in cleared funds. The Client acknowledges that ICBCIS may at any time before
final receipt, or if a Clearance System at any time reverses an applicable credit (or an Agent of
ICBCIS makes a corresponding credit to ICBCIS), reverse all or any part of a credit of cash in
the Account to the Client and make an appropriate entry to its records including restatement of
the Account and reversing any interest paid.
4.5 ICBCIS will credit Overseas Securities to the Account upon receipt of the Overseas Securities
by final settlement determined in accordance with the practices of the relevant market. Final
settlement depends on the market confirmation of settlement to ICBCIS and may include real
time movement with finality or real time movement without finality, or confirmation of
settlement but movement of securities at end of the day. If any Clearance System reverses any
credit of Overseas Securities (or ICBCIS or its Agent(s) are otherwise obligated to return
Overseas Securities as a result of a settlement reversed in accordance with market
requirements) or an Agent of ICBCIS makes a corresponding credit to ICBCIS, the Client
acknowledges that ICBCIS may reverse all or any part of a credit of the Overseas Securities to
the Account and make an appropriate entry to its records including restatement of the Account.
In the event of any reversal of Overseas Securities, ICBCIS may reverse any credit of cash
provided to the Client in regard to the Overseas Securities such as distributions or the proceeds
of any Transaction.
4.6 Where there is a reversal of Overseas Securities or cash in the Account, ICBCIS is not
required to specifically notify the Client. If there is insufficient cash in the required currency
or Overseas Securities to satisfy the reversal, the Client shall, as applicable, promptly repay in
the applicable currency the amount required to satisfy the deficit in the Account and/or place
any Overseas Securities to the Account.
4.7 Any Client's assets received or held outside Hong Kong shall be subject to the Applicable
Laws of the relevant overseas jurisdiction which may be different from Hong Kong law,
including the SFO and the rules made thereunder. The Client understands that such assets may
not enjoy the same protection as that conferred on client assets received or held in Hong Kong.
4.8 Notwithstanding any provisions to the contrary in the Standard Terms and Conditions, the
Client hereby expressly authorizes ICBCIS and/or its Agents to, subject to Applicable Laws:
(a) deposit, transfer, lend, pledge, repledge or otherwise deal with any of the Overseas
Securities held in the Account for the purpose of settling any liability owed by or on
behalf of the Client to ICBCIS, an Associated Entity or a third person;
(b) apply any of the Overseas Securities held in the Account pursuant to a securities
borrowing and lending agreement;
(c) deposit any of the Overseas Securities held in the Account with another financial
institution or intermediary for financial accommodation provided to ICBCIS or its
Agents ;
(d) deposit any of the Overseas Securities held in the Account with another financial
institution or intermediary as collateral for the discharge and satisfaction of settlement
obligations and liabilities of ICBCIS or its Agents; and
(e) apply any of the Overseas Securities held in the Account pursuant to the terms of
business or agreement with any executing or settlement broker(s), custodian(s), and/or
Agent(s) used by ICBCIS.
4.9 Absent a contrary Instruction, the Client agrees that ICBCIS and/or its Agent(s) will be
authorized to carry out non-discretionary matters in connection with any Instruction or
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services provided hereunder. Without limiting the authority of ICBCIS and/or its Agent(s)
with regard to non-discretionary matters, the Client authorizes ICBCIS and/or its Agent(s) to
carry out the following:
(a) in the Client's name or on its behalf, sign any documents relating to the Overseas
Securities or cash which may be required (i) pursuant to an Instruction to obtain any
Overseas Securities or cash; or (ii) by any Tax or other regulatory authority or market
practice;
(b) receive and/or credit income, payments and distributions in respect of the Overseas
Securities;
(c) exchange interim or temporary receipts for definitive certificates, and old or
overstamped certificates for new certificates;
(d) deposit Overseas Securities with any Clearance System as required by Applicable
Laws;
(e) make any payment by debiting any balance credited to the Client as required to effect
any Instructions, payment of Taxes or other payment provided herein;
(f) to the extent any shortage of Overseas Securities or cash occurs in connection with
receipt of distributions with regards to any corporate action, make pro rata
distributions, allocations, deliveries or credits of received Overseas Securities or cash
as consistent with market practice and as it deems fair and equitable; and
(g) take any other actions which ICBCIS and/or its Agent(s) consider reasonably
necessary in furtherance of the services provided hereunder.
4.10 In the event ICBCIS exercises its rights or authority under the Agreement to close any or all
contracts between ICBCIS and the Client and/or sell or dispose of any Overseas Securities in
the Account, the Client agrees that ICBCIS may effect any currency exchange transaction in
respect of the proceeds of such sale or disposal as ICBCIS sees fit (and at such exchange rate
as ICBCIS shall determine at the relevant time) to satisfy any outstanding actual or contingent
liabilities owed by the Client to ICBCIS.
5. OTHER PROVISIONS ON SERVICES
5.1 ICBCIS is authorized, at its discretion, to take such steps as it may consider appropriate to
enable it to provide the services hereunder and to exercise its powers, including the right:
(a) to return to the Client Overseas Securities which may not have the same serial number
or identification as those originally deposited with or received by ICBCIS; or
(b) to participate in and to comply with the rules and regulations of the depository and any
system which provides central clearing and settlement facilities in respect of the
Overseas Securities and to hold the Overseas Securities in any such depository or
system without ICBCIS incurring any liability for any acts or omissions on the part of
the manager or operator of such system or depository.
6. APPLICABLE LAWS AND REGULATIONS
6.1 All Transactions executed in Overseas Securities shall be subject to the Applicable Laws and
the applicable terms of business or agreement with any executing or settlement broker(s),
custodian(s) and/or Agent(s) used by ICBCIS, and all actions taken by ICBCIS in accordance
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therewith shall be binding on the Client. The Client shall enter into and comply with the terms
and conditions of any agreement required by any Exchange, trading venue, Clearance System
or market centre where any Instruction is executed or cleared. The Client agrees and
undertakes to provide information and documents and take such actions as requested by
ICBCIS from time to time to enable ICBCIS to comply with the Applicable Laws and/or
requests from relevant government or regulatory authorities and perform its contractual
obligations with its counterparts.
6.2 To the extent that the Client receives Exchange data, financial information or other data from
ICBCIS, its Agents or other third parties ("Market Data"), the Client agrees to comply with
any relevant Market Data agreements governing the receipt and use by it of the same. The
Client agrees that to the maximum extent permitted under applicable law and not inconsistent
with the applicable obligations of ICBCIS under the Code in respect of the services in
Securities under the Agreement, and subject to Clause 18.4 of the Standard Terms and
Conditions, ICBCIS shall not be responsible for the timeliness, accuracy or reliability of
Market Data.
6.3 Without limitation to Clause 3 of the General Terms and Conditions, the Client hereby
undertakes to comply with all the Applicable Laws. The Client agrees that it is solely
responsible for all filings, notifications, returns (including Tax returns), reports, disclosures of
beneficial ownership or other requirements of any jurisdiction relating to any Overseas
Securities or cash held for the Client or Transactions concerning such Overseas Securities, and
ICBCIS shall assume no responsibility. The Client also agrees to do such things as ICBCIS
may require to ensure compliance with the same. The Client further agrees that to the
maximum extent permitted under applicable law and not inconsistent with the applicable
obligations of ICBCIS under the Code in respect of the services in Securities under the
Agreement, ICBCIS shall not be obliged to monitor interest holding positions of the Client, or
determine, advise or assist the Client in any way in respect of any such filings, notifications,
returns, reports or disclosure obligations applicable to the Client under any Applicable Law.
The Client shall be responsible for compliance with all applicable limitations or qualifications
with regards to the Client's investment in any Overseas Securities in any jurisdiction.
6.4 The Client agrees and acknowledges that the procedures and requirements for trading in
Overseas Securities may differ in each jurisdiction. The Client agrees that it shall comply with
the relevant procedures and requirements and if required, sign further documentation, provide
additional information or take other steps and actions as may be necessary from time to time.
7. LIEN
7.1 The Client agrees and acknowledges that ICBCIS may grant lien on Overseas Securities
(which are held by ICBCIS for a Client) to a third party until satisfaction of liabilities and
obligations (whether actual or contingent) of ICBCIS to such third party. The Client agrees
and acknowledges that such third party may (i) appropriate and apply all or any part of the
Overseas Securities and cash held by such third party for ICBCIS (including those held in an
omnibus account maintained by ICBCIS for the Client) against any or all obligations of
ICBCIS to such third party (whether matured or subject to any demand); (ii) sell all or any of
such Overseas Securities and (iii) exercise in respect of such Overseas Securities and cash all
the rights and remedies a party with a senior security or similar right would be entitled to
exercise in such default under any Applicable Laws.
8. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
8.1 The Client warrants, represents and undertakes to ICBCIS that:-
(a) the Client has the legal capacity and authority to enter into and perform this Appendix;
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(b) the Client has full power and authority to perform the obligations and grant the
authorizations under the provisions in this Appendix and if the Client is a corporate
Client, the Client has taken all necessary action or corporate action to authorize the
performance of such obligations and the grant of such authorizations;
(c) the Client has obtained and is in compliance with all necessary and appropriate
consents, approvals and authorizations for the purposes of its entry into and
performance of this Appendix;
(d) Information supplied by the Client is accurate and complete;
(e) No one, other than the Client, has an interest in the Client's account;
(f) the Client's entry into and performance of this Appendix will not violate any
Applicable Laws;
(g) the Client has the authority and the capacity to deliver the Required Amount (including
the Overseas Securities and cash) in the Account;
(h) there is no claim or encumbrance that adversely affects any deposit with custodians,
deposit with Clearance System, delivery of Overseas Securities and/or payment of cash
made in accordance with this Appendix;
(i) except as provided in the Agreement, the Client has not granted any person a lien,
security interest, charge or similar right or claim against Overseas Securities and cash
in the Account;
(j) the Overseas Securities held or maintained or to be held or maintained in the Account
from time to time are freely transferrable and fully negotiable; and
(k) the Client is not domiciled in or resident in a country where there is any restriction on
the Client's sale, purchase, holding or transfer of any Overseas Securities, and that the
Client is not subject to, and is not acting on behalf of any person who is subject to, any
restriction or prohibition against the sale, purchase, holding of, or dealing in any such
Overseas Securities. If the Client or any person the Client acts on behalf of becomes
subject to any restrictions (whether by reason of a change of the Client's domicile,
residence or otherwise in any such country), the Client shall inform ICBCIS
immediately.
8.2 The representations, warranties and undertakings in Clause 8.1 of this Appendix shall be
deemed to be repeated immediately before each Transaction or dealing is carried out for or any
service is provided to the Client or on the Client’s behalf.
8.3 If the Client is aware that any of the representations, warranties and undertakings in Clause 8.1
of this Appendix will or may become incorrect, the Client must give prior notice to ICBCIS
immediately upon the Client becoming aware of the same, and before such representations,
warranties and undertakings become incorrect. The Client must also notify ICBCIS
immediately if any of the said representations, warranties and undertakings has become
incorrect. For the avoidance of doubt, any representation, warranty or undertaking made in this
Appendix which is or becomes incorrect in any respect shall constitute an event of default
under Clause 24.1 of the General Terms and Conditions.
8.4 Without limitation to any provisions in this Appendix and in the Agreement, upon ICBCIS
receiving notice from the Client that any of the representations, warranties and undertakings in
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Clause 8.1 of this Appendix may become incorrect, or if any of the said representations,
warranties and undertakings has become incorrect:
(a) ICBCIS shall be entitled, in its sole discretion, to dispose of all Overseas Securities
held by the Client, suspend the services provided under the Agreement, close the
Account and/or charge the Client all fees, charges, costs and expenses incurred or to
be incurred by ICBCIS from time to time to ensure compliance by ICBCIS or its
Agents with all Applicable Laws arising from or in connection with the above
(including, without limitation, all fees, charges, costs and expenses incurred to make
all the necessary filings with the relevant authorities); and
(b) the Client shall immediately upon request by ICBCIS withdraw all the Overseas
Securities or other securities from the Account, and do/or execute any act, deed,
document which ICBCIS may require in connection therewith.
9. DISCLOSURE OF INFORMATION
9.1 The Client agrees that its data may be transferred to any place outside Hong Kong, whether for
the processing, holding or use of such data outside Hong Kong.
9.2 The Client undertakes to provide such information as ICBCIS may request from time to time in
order for ICBCIS and/or its brokers, custodians or Agents to provide the services under this
Appendix and/or the Agreement, or for ICBCIS and/or such brokers, custodians or Agents to
comply with the Applicable Laws or to respond to requests from any government, legal or
regulatory authority or Exchange, Clearance System, or for ICBCIS and/or such brokers,
custodians or Agents to comply with any obligations or to determine the extent to which the
Client is subject to (or exempt from) withholding under FATCA. The Client will also comply
in a timely manner with ICBCI's requests for information, documents or other materials to the
extent ICBCIS considers necessary to ensure compliance with its internal policies and
procedures.
9.3 The Client authorizes ICBCIS to disclose any information that it has concerning the Client
(including the Authorized Persons and the Beneficial Identity), the Account and any Overseas
Securities, monies or other assets held in the Account: (a) to any broker, custodian, clearing
agent or other person(s) (whether within or outside Hong Kong) appointed by ICBCIS in
connection with the services provided pursuant to the provisions in this Appendix and/or the
Agreement; (b) upon request, to any government, legal or regulatory authority or Exchange,
Clearance System (whether within or outside Hong Kong); or (c) to such other persons
(whether within or outside Hong Kong) in compliance with the Applicable Laws or FATCA.
10. COMMUNICATION AND ACCESS; CORPORATE ACTIONS
10.1 Where ICBCIS forwards to the Client any notice, document or information prepared by other
persons including issuers or Clearance System in respect of the Overseas Securities, ICBCIS
shall not responsible for errors, inaccuracies or omissions in such notices or information to the
maximum extent permitted under applicable law and not inconsistent with the applicable
obligations of ICBCIS under the Code in respect of the services in Securities under the
Agreement, and subject to Clause 18.4 of the Standard Terms and Conditions.
10.2 The Client acknowledges that ICBCIS will not participate in or take any corporate action
concerning Overseas Securities (including shareholder voting) if ICBCIS does not receive a
timely instruction from the Client. Notwithstanding any other provisions in the Agreement,
ICBCIS will be required to provide shareholder voting services and take such other corporate
actions in respect of the Overseas Securities only as specified in a separate proxy letter
agreement between ICBCIS and the Client, or such other agreement as required by ICBCIS
from time to time.
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10.3 The Client acknowledges that in some markets, ICBCIS or its Agent(s) may be required to
vote all Overseas Securities held for a particular issue for all of its clients in the same way
without regard to any Instruction.
11. TAXES AND OTHER PAYMENTS
11.1 The Client agrees that the Client is responsible for discharging the Client's own Tax reporting
and filing obligations. In addition, the Client shall pay and reimburse ICBCIS for any and all
Taxes, fees, charges, obligations and liabilities or payments payable or paid by ICBCIS in
connection with the Account, services provided herein or any Transactions relating to the
Overseas Securities. The Client agrees that ICBCIS may debit the cash in the Account to pay
any such fees, charges, obligations, liabilities and payments, and that such amount to be
payable to ICBCIS shall be without deduction for Taxes.
11.2 The Client authorizes ICBCIS and its Agent(s) on the Client's behalf to debit, withhold and/or
make payment of any Taxes payable in connection with the Account or any Transactions
relating to the Overseas Securities. Without prejudice to the foregoing, ICBCIS will deduct or
withhold for or on account of Taxes from any payment to the Client if required by any
Applicable Laws including but not limited to (i) statute or regulation, (ii) legal, governmental
or regulatory authority or (iii) agreement entered into by ICBCIS or its Agent and any
governmental or regulatory authority or between two or more governmental or regulatory
authorities. The Client acknowledges that ICBCIS may debit any amount available in any
balance held for the Client and apply such cash in the Account in satisfaction of Taxes. If any
Taxes become payable with respect to any prior credit to the Client by ICBCIS, the Client
acknowledges that ICBCIS may debit any balance held for the Client in satisfaction of such
prior Taxes. The Client shall remain liable for any deficiency and agrees that it shall pay upon
notice from ICBCIS or any governmental or regulatory authority. If Taxes are paid by
ICBCIS or any of its Agents or Affiliates, the Client agrees that it shall promptly reimburse
ICBCIS for such payment to the extent not covered by withholding from any payment or
debited from any balance held for the Client.
11.3 The Client shall provide ICBCIS with information and proof as to the Client's and/or the
underlying beneficial owner's Tax status or residence or other information as ICBCIS
reasonably requests in order for ICBCIS or its Agent to achieve compliance with the
requirements of governmental or regulatory authorities. Information and proof may include
executed certificates, representations and warranties, or other documentation ICBCIS deems
necessary or proper to fulfil the requirements of applicable Tax authorities. The Client shall
promptly notify ICBCIS in writing of any change that affects the Client's Tax status pursuant
to any Applicable Laws or agreement entered into between two or more governmental or
regulatory authorities.
12. THIRD PARTIES
12.1 The Client agrees that ICBCIS or its Agent may participate in or use (i) Clearance Systems and
(ii) public utilities, external telecommunications facilities or other common carriers of
electronic and other messages, external postal services and other facilities commonly
recognized as market infrastructure in any jurisdiction. In providing services hereunder,
ICBCIS or its Agent may interact with other third parties who are beyond their selection or
control including issuers of Overseas Securities, transfer agents or registrars. The Client
acknowledges that Clearance Systems and such other third parties are not ICBCIS's agents and
ICBCIS has no responsibility for selecting, appointing or monitoring such third parties or the
performance or credit risks of such third parties.
13. LIABILITY AND INDEMNITY
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13.1 The Client shall fully indemnify the Indemnified Persons against all claims, actions, liabilities
(whether actual or contingent) and proceedings against any of the Indemnified Persons and
bear any losses, costs, charges or expenses (including legal fees) which the Indemnified
Persons may suffer or incur arising from or in connection with or resulting from any breach by
the Client of any of the representations, warranties and undertakings in Clause 8.1 of this
Appendix or the Client's failure to perform any of its obligations hereunder.
14. RISKS
14.1 The Client agrees that it shall bear all risks and expenses associated with investing in Overseas
Securities or holding cash denominated in any currency. The Client acknowledges that
ICBCIS will not be liable for country specific risks of loss or value or other restrictions
resulting from country risk including the risk of investing and holding Overseas Securities and
cash of or in a particular country or market such as, but not limited to, risks arising from (i)
any act of war, terrorism, riot or civil commotion, (ii) investment, repatriation or exchange
control restriction or nationalization, expropriation or other actions by any governmental
authority, (iii) devaluation or revaluation of any currency, (iv) changes in Applicable Laws,
and (v) a country's financial infrastructure and practices including market rules and conditions.
14.2 All currency exchange risks in respect of any Transactions, settlement actions or steps taken
by ICBCIS hereunder shall be borne by the Client.
15. SURVIVING TERMS
15.1 The parties agree that the rights and obligations contained in Clauses 3.3, 3.4, 3.5, 3.6, 3.8, 4.4,
4.5, 4.6, 4.10, 6.3, 7, 11, and 13 of this Appendix shall survive the termination of the
Agreement.
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Annexure 1
SINGAPORE
This Annexure applies in respect of securities trading services in Singapore Securities provided by
ICBCIS to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for Overseas Securities
Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in Singapore Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"CDP" means Central Depository Pte Limited.
"Eligible Securities" means securities which are:
(a) of good delivery and where applicable, accompanied by duly executed and properly
stamped instruments of transfer in favour of the CDP or its nominee;
(b) capable of being held on a fungible basis;
(c) are not subject to any restrictions on foreign ownership, unless otherwise agreed to by
the CDP; and
(d) are not subject to any restrictions on transferability in a book-entry system, unless
otherwise agreed to by the CDP.
"Listed Securities" means securities which are listed on the SGX-ST.
"SGX" means the Singapore Exchange, which includes SGX-ST.
"SGX-ST” means Singapore Exchange Securities Trading Limited.
"Singapore person" means a Singapore citizen, Singapore permanent resident, Singapore-
incorporated company, any persons resident in Singapore (as defined under the Income Tax
Act (Cap. 134) or any other person residing in Singapore or having its place of business in
Singapore.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:-
(a) that the Client is not a Singapore person;
(b) without prejudice to Clause 6.3 of the Appendix for Overseas Securities Trading, the
Client is solely responsible for declaring its substantial shareholdings or similar or
analogous requirements under and in accordance with all Applicable Laws, including
the provisions of the Companies Act, Chapter 50 of Singapore and the Securities and
Futures Act, Chapter 289 of Singapore and has complied with all such requirements
and Applicable Laws. For the avoidance of doubt, this includes, but is not limited to,
any disclosures required as a result of the Client being a director or related person of
the issuer of Listed Securities;
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(c) without prejudice to Clause 6.3 of the Appendix for Overseas Securities Trading, the
Client is solely responsible for ascertaining, complying and ensuring continued
compliance with any shareholding restrictions (including foreign ownership
requirements and/or industry specific requirements) under all Applicable Laws and has
complied with the same. This includes, but not limited to, making any filings,
notifications, disclosures, obtaining any approvals or registrations with the appropriate
regulatory bodies or to the issuer; and
(d) without prejudice to Clause 6.3 of the Appendix for Overseas Securities Trading, the
Client understands and will be solely responsible for, complying and ensuring
continued compliance with the Applicable Laws (including the requirements of SGX,
any relevant market requirements and any other guidelines, whether or not they may
have the force of law).
2.2 The representations, warranties and undertakings in Clause 2.1 of this Annexure shall be
deemed to be repeated immediately before each Transaction or dealing is carried out for or any
service is provided to the Client or on the Client’s behalf.
2.3 If the Client is aware that any of the representations, warranties and undertakings in Clause 2.1
of this Annexure will or may become incorrect, the Client must give prior notice to ICBCIS
immediately upon the Client becoming aware of the same, and before such representations,
warranties and undertakings become incorrect. The Client must also notify ICBCIS
immediately if any of the said representations, warranties and undertakings has become
incorrect.
3. TRADING IN LISTED SECURITIES
3.1 The Client acknowledges that the CDP shall accept for deposit securities it designates to be
Eligible Securities. The CDP has the discretion to refuse to accept any deposit of securities
and may designate that any security is no longer an Eligible Security, upon giving reasons for
such refusal or designation.
3.2 The Client acknowledges that the SGX and/or CDP may impose reporting requirements on
ICBCIS or the relevant SGX trading or clearing member and/or depository agent (as the case
may be) in respect of the Client's position levels or transactions and the Client hereby
irrevocably agrees to make such reporting or disclosure of any information concerning the
Client and/or its relevant positions to any government, legal or regulatory authority, or
Exchange, Clearing House or depository (whether within or outside Hong Kong).
3.3 The Client acknowledges that the SGX may from time to time, impose position limits or
trading limits which may affect the Client's ability to trade in the Listed Securities or ICBCIS'
ability to trade on behalf of the Client. The Client agrees that ICBCIS will not be liable for
any losses as a result of such limits.
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Annexure 2
JAPAN
This Annexure applies in respect of securities trading services in Japan Securities provided by ICBCIS
to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for Overseas Securities Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in Japan Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"Consumption Tax Act" means Consumption Tax Act of Japan (Act no. 108 of 1988).
"FEA" means Foreign Exchange and Foreign Trade Act of Japan (Act No. 228 of 1949).
"FIEA" means Financial Instruments and Exchange Act of Japan (Act No. 25 of 1948).
"Foreign investors" mean (i) individuals not resident in Japan, (ii) corporations which are
organized under the laws of foreign countries or whose principal offices are located outside
Japan, and (iii) corporations of which (a) 50% or more of the shares are held directly or
indirectly by (i) or (ii) above, (b) a majority of officers consists of non-residents of Japan or (c)
a majority of officers having the power of representation consists of non-residents of Japan.
"Insider Information" means (i) undisclosed insider information defined as "material facts
pertaining to business or other matters" in Article 166, Paragraph 2 of the FIEA and (ii) facts
concerning launch of a tender offer and suspension of tender offer prescribed in Article 167,
Paragraph 2 of the FIEA.
"Non-residents of Japan" mean individuals who are not resident in Japan and corporations
whose principal offices are located outside Japan.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:-
(a) the Client is a Non-resident of Japan;
(b) the Transactions of the Client in Overseas Securities traded in Japan are not subject to
Japanese Consumption Tax under the Consumption Tax Act;
(c) the Client shall not be eligible for Japanese Consumption Tax Refund/Credit in
accordance with the Consumption Tax Act in respect of any fees payable by the Client
relating to the Transactions in Overseas Securities traded in Japan;
(d) the Client does not possess any Insider Information in respect of securities traded in
Japan in Transaction;
(e) Transaction does not trigger a tender offer under the FIEA (if applicable);
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(f) where the Client is a Foreign investor, (i) the Client does not, as a result of any
Transaction(s), directly or indirectly hold, aggregated with existing holdings, 10% or more
of the issued shares listed on any Japanese stock exchange which requires pre-notification
to the Minister of Finance and any other competent ministers in accordance with
Article 27, Paragraph 1 of the FEA or (ii) the Client has already duly submitted such
notification and 30 days have passed since the date of the notification; and
(g) the Client shall be responsible for all filings, notifications, reports or other
requirements in relation to Transaction including but not limited to the substantial
shareholding reports and their amendment reports in accordance with Article 27-23 or
27-25 of the FIEA or after-the-fact filings to the Minister of Finance and any other
competent ministers in accordance with Article 55-5 of the FEA..
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Annexure 3
U.S.
This Annexure applies in respect of securities trading services in U.S. Securities provided by ICBCIS
to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for Overseas Securities Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in U.S. Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"U.S. Person" means (a) a citizen or resident of the United States; (b) a corporation,
partnership or other entity created or organised in or under the laws of the United States or any
political subdivision thereof; (c) an entity created or organised in or under the laws of any
other jurisdiction if treated as a domestic corporation pursuant to the United States federal
income tax laws; (d) any estate or trust that is subject to the United States federal income
taxation regardless of the source of its income; (e) any corporation, partnership, trust, estate or
other entity in which one or more individuals or entities described in (a), (b), (c) or (d) acting
singly or as a group has or have a controlling beneficial interest whether directly or indirectly
and, in the case of a corporation or partnership, which is formed principally for the purpose of
investing in securities not registered under the United States federal securities laws; (f) a trust
if a court within the United States is able to exercise primary supervision over its
administration and one or more United States Persons have the authority to control all the
substantial decisions of such trust; (g) a trust in existence on 20 August 1996 and treated as a
domestic trust (as defined in the relevant treasury regulations in the United States) prior to
such date and that has elected to continue to be treated as a domestic trust; (h) any corporation,
partnership or other entity, regardless of citizenship, domiciles, situs or residence, if under the
federal income tax laws of the United States ten percent (10%) or more of the ownership of
any mutual fund would be attributed through such entity to any U.S. Person (i) any person
fitting the definition of U.S. Person under Regulation S1, promulgated under the Securities Act
of 1933 or (j) any person causing ICBCIS to use U.S. interstate commerce in the process of
effecting securities transactions.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:-
(a) unless otherwise specifically declared by the Client, the Client is not a U.S. Person and
the Client is not acting for, or on behalf of a U.S. Person;
1 This includes any (1) trust of which any trustee is a U.S. Person (2) agency or branch of a foreign entity located in the U.S.
(3) non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the
benefit or account of a U.S. Person (4) any discretionary account or similar account (other than an estate or trust) held by a
dealer or other fiduciary organized or incorporated, or (if an individual) resident in the U.S.; and (5) any partnership,
corporation or other entity (other than a trust) if (i) organized or incorporated under the laws of any non-U.S. jurisdiction and
formed by a U.S. person principally for the purpose of investing in securities not registered under the Securities Act of 1933.
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(b) the Client is not a director, 10% beneficial shareholder or policy-making officer or
otherwise an affiliate of any company publicly traded in the United States;
(c) the Client is not at the time the Account is opened and will not at any time during the
continuance of the Account, hold in such Account or effect Transactions through such
Account, securities of any company with securities traded in the U.S. in which he is:
(i) a direct or indirect owner or beneficial owner (which would include the power
to vote shares pursuant to trust or other instrument) of 10% or more than 10%
of any class of voting securities of the company;
(ii) in a direct or indirect management or other decision-making position in the
company;
(iii) closely-related to (spouse, parent, sibling, in-law), financially dependent on, or
the primary financial support for, any person who owns, directly or indirectly
outright or through beneficial ownership, 10% or more than 10% of any class
of voting securities of such company and holds a direct or indirect
management or other decision-making position in such company; or
(iv) a member of a formal or informal group that acting together will control 10%
or more than 10% of any class of voting securities of such company;
(d) the Client is not an employee of or affiliated with any U.S. securities exchange or
member firm of any Exchange, the Financial Industry Regulatory Authority or any
securities firm, bank, trust company or insurance company;
(e) the Client understands that ICBCIS does not provide Tax or legal advice, nor does it
provide advice with regard to corporate actions and the Client may not rely on any
information that ICBCIS may provide in connection therewith;
(f) should the Client issue instructions to purchase a stock or other financial instrument
"over-the-counter" (each an "OTC Traded Stock") it acknowledges such OTC
Traded Stocks are generally conducted directly with market makers or other counter
parties and do not have the supervision of any Exchange. Client specifically
acknowledges that OTC Traded Stocks can lead to significant risks including the risk
that the counterparty will not perform its part as obligated by the transaction. Client
acknowledges that offsetting such risk is not always possible and specifically attests
and warrants that it will bear such risk alone. Client hereby warrants that it will not
hold ICBCIS responsible for any such counterparty or other risk associated with OTC
Traded Stocks;
(g) should the Client issue instructions to purchase an OTC Traded Stock, it will comply
with the requirements of the executing broker and supply any needed information to
establish the Client's ability to purchase such OTC Traded Stock;
(h) trading in Overseas Securities will be executed through one or more local brokers.
Client acknowledges that brokers trading in the U.S. (each a "U.S. Broker") are
subject to rules promulgated by various regulators including the state securities
regulators in the 50 states, the U.S. Securities and Exchange Commission ("SEC"),
the Financial Industry Regulatory Authority ("FINRA"). Client acknowledges that
such obligations may require ICBCIS to provide the U.S. Brokers with information
about the Client and the Account, including but not limited to, confidential
information. Client warrants that it will not hold ICBCIS liable for any effect of
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providing such information to any U.S. Broker, any state securities regulator, the SEC
or FINRA;
(i) Client understands that ICBCIS will seek to effect orders at Client's Instruction.
ICBCIS or a U.S. Broker may act as an agent or principal (not at risk) for both buyer
and seller of American Depository Receipts ("ADRs") and/or ordinary shares, and
may charge a commission or other fees to both parties. The foreign exchange rate
selected, financing fee and the conversion fee set by the U.S. Broker may not be the
best or most favourable rates or fees available to the Client, or the rates or fees
charged to the U.S. Broker or ICBCIS. Client acknowledges that the U.S. Broker
and/or ICBCIS may earn revenue on some or all of these fees including the spreads on
securities transactions traded on a net basis. Costs associated with Instructions and
ADR conversions can also include local market and other fees. For ADR conversions
the actions or inaction of any entity facilitating the interchange of ADRs and the
underlying ordinary shares and the U.S. Broker executing on the local market are
those of such entity and not ICBCIS. ICBCIS has no liability for such actions or
inactions;
(j) when the Client issues Instructions involving an ADR it specifically also authorizes
ICBCIS to facilitate to swapping of such ADR with ordinary shares. Client
understands this is a final instruction and cannot be reversed; and
(k) it is the Client's sole responsibility to determine if an ADR conversion, if conducted
during a corporate action could result in a participating bank, U.S. Broker or ICBCIS
closing its books to conversion or otherwise resulting in a claimable event, and
ICBCIS will not advise or assist the Client in this determination or be liable for its
outcome in any way. The Client agrees ICBCIS is not liable, and that it shall
promptly pay directly or reimburse ICBCIS for (i) any claims which may arise before,
during or after, any corporate action relating to the ordinary shares regardless of
reason or validity of such claims.
3. MARGIN DISCLOSURE STATEMENT (Applicable to Margin Accounts)
3.1 When considering a margin loan, the Client should determine how the use of margin fits its
own investment philosophy. It is important that the Client fully understands the risks, rules,
and requirements involved in trading securities on margin.
3.2 The following paragraphs highlight some of the critical aspects of margin trading:
Margin trading increases the level of market risk. Margin trading increases the Client's
buying power, allowing the Client to purchase a greater amount of securities with the Client's
investing dollar. Therefore, the Client's exposure to market volatility increases—a declining
market could result in even greater losses. A decline in the value of the Client's securities that
the Client purchases on margin may require the Client to provide additional funds to ICBCIS
in order to avoid the forced sale of those securities or other securities in the Client's account.
Downside is not limited to the collateral value in the Client's margin account. When the
Client buys securities on margin, the Client is borrowing money from ICBCIS for part of the
Client's transactions. Securities and other assets in the Client's account(s) are pledged as
collateral to secure this loan. These margin transactions are riskier and involve the possibility
of greater loss than transactions where the Client is not borrowing money. If the securities in
the Client's account decline in value, so does the value of the collateral supporting the Client's
loan. When the value of the collateral falls below the maintenance margin requirements, or
ICBCIS’ higher “house” requirements, ICBCIS can move to protect its position. In order to
cover margin deficiencies, ICBCIS may issue a margin call to the Client—a request for
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additional cash—or sell securities from the Client's account. If a sale does not cover the
deficiency, the Client will be responsible for any shortfall.
ICBCIS may initiate the sale of any securities in the Client's account, without contacting
the Client, to meet a margin call. ICBCIS may, but is not obligated to, attempt to involve the
Client in the case of margin deficiency; however, market conditions may require ICBCIS to
quickly sell any of the Client's securities without the Client's consent. Because the securities
are collateral for the margin loan, ICBCIS has the right to decide which security to sell in
order to protect its interests. Even if ICBCIS has contacted the Client and provided a specific
date by which the Client can meet a margin call, ICBCIS can still take necessary steps to
protect its financial interests, including immediately selling the securities without prior notice
to the Client.
ICBCIS’ “house” initial and maintenance margin requirements may exceed those established
by the Federal Reserve Board and/or the FINRA.
ICBCIS may change its initial margin requirements at any time and without prior notice.
ICBCIS may also impose anytime and without prior notice more stringent requirements on
positions that in ICBCIS' sole discretion involve higher levels of risk; for example, higher
limits may apply for thinly traded, speculative or volatile securities, or concentrated positions
of securities.
ICBCIS may increase its “house” maintenance margin requirements at any time and is
not required to provide the Client with advance written notice. Changes in ICBCI’s policy
regarding “house” maintenance margin requirements often take effect immediately and may
result in the issuance of a maintenance margin call. The Client's failure to satisfy the call may
cause ICBCIS to liquidate or sell securities in the Client's account.
ICBCIS retains absolute discretion to determine whether, when and in what amounts ICBCIS
will require additional collateral. For example, ICBCIS may require additional collateral if an
account contains only one security or a large concentration of one or more securities; or low-
priced, thinly traded or volatile securities; or if some of the Client's collateral is or becomes
restricted or non-negotiable or non-marginable. ICBCIS may also consider market conditions,
the Client's financial resources, or other factors deemed by ICBCIS to be relevant given the
circumstances at the time.
The Client is not entitled to an extension of time on a margin call. While an extension of
time to meet margin requirements may be available to the Client under certain conditions, the
Client does not have a right to the extension.
Some accounts that carry a margin loan balance and hold dividend-paying securities may
receive a “substitute income payment in lieu of a dividend” (PIL). This payment may be
taxable as ordinary income. Taxable accounts that receive a PIL instead of a qualified dividend
may also receive a supplemental credit from ICBCIS.
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Annexure 4
France
This Annexure applies in respect of securities trading services in French Securities (as defined below)
provided by ICBCIS to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for
Overseas Securities Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in French Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"Class A Sensitive Sector" means any of the sectors listed in paragraphs 1° to 7° of article R.
153-2 of the French Monetary and Financial Code, which are translated below, for information
purposes only:
1. Gambling sectors (with the exception of casinos);
2. Private security regulated services;
3. Research, development or production of means aimed at fighting the illegal use, in
connection with terrorist activities, of pathogenic and toxic substances and preventing the
health consequences of such use;
4. Activities related to equipment used for intercepting communication and remote detection
of conversations;
5. Services in connection with approved evaluation centers under the conditions set forth in
decree No. 2002-535 of April 18, 2002 relating to evaluation and certification of security
of information technology products and systems;
6. Activities of production of goods or services provision of security in the information
systems' security sector of a company that entered into a contract with a public or private
operator managing facilities within the meaning of Articles L. 1332-1 to L. 1332-7 of the
French Defense Code;
7. Activities relating to dual-use items or technologies mentioned in Appendix IV of EC
regulation No. 428/2009 of May 5, 2009 setting up a Community regime for the control of
exports, transfer, brokering and transit of dual-use items.
"Class B Sensitive Sector" means any of the sectors listed in paragraphs 8° to 12° of article R.
153-2 of the French Monetary and Financial Code, which are translated below, for information
purposes only:
1. Activities relating to the means of cryptology and services of cryptology mentioned in
paragraphs III, IV of Article 30 and I of Article 31 of the law No. 2004-575 of June 21,
2004 for the law on confidence in the digital economy;
2. Activities exercised by companies custodians of secret of national defense including
classified markets of national defense or of security clauses in accordance with Articles R.
2311-1 et seq. of the French Defense Code relating to the protection of national defense's
secret;
3. Activities of research, production or trade of weapons, ammunition, powder and explosive
substances for military purposes or war equipment and assimilated;
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4. Activities exercised by companies having concluded a contract of research or of supply of
equipment for the French Ministry of Defense, either directly, or through subcontractors,
for the realization of a good or a service falling within the scope of the activities mentioned
above at 7°) to 10°);
5. Other activities relating to equipment, products or services, including those relating to the
safety and the proper functioning of facilities and equipment, essential to guarantee the
French national interests in terms of public policy, public security or national defense, as
listed below (these new sectors which include energy, transport, water, public health and
telecommunications were introduced by the decree No. 2014-479, dated May 14, 2014):
(a) integrity, security and continuity of the supply of electricity, gas, oil or other source of
energy;
(b) integrity, security and continuity of the water supply in accordance with the standards
laid down in the interest of public health;
(c) integrity, security and continuity of the operation of transportation networks and
services;
(d) integrity, security and continuity of the operation of electronic communication
networks and services;
(e) integrity, security and continuity of the operation of an installation, facility or structure
of vital importance;
(f) protection of public health.
"French Resident" means resident of France for tax purposes within the meaning of Article 4
B of the French Tax Code or whose registered office is outside France.
"French Securities" means financial instruments (instruments financiers) within the meaning
of Article L. 211-1 of the French Monetary and Financial Code.
"Inside Information" means inside information within the meaning of Article 7 of the Market
Abuse Regulation.
"Market Abuse Regulation" means regulation (EU) n° 596/2014 of the European Parlimant
and of the Council of 16 april 201 on market abuse.
"Multilateral Trading Facility" means a multilateral trading facility (système multilateral de
négociation) within the meaning of Articles L. 424-1 and subsequent of the French Monetary
and Financial Code - as of the date of this Annexure, the sole existing multilateral trading
facility in France is Euronext Growth Paris.
"NCST" means non-collaborative states and territoritories (Etats et territoires non-coopératifs)
within the meaning of Article 238-0 A of the French Tax Code.
"Regulated Market" means a regulated market (marché réglementé) within the meaning of
Articles L. 421-1 and subsequent of the French Monetary and Financial Code - as of the date
of this Annexure, the sole existing regulated market in France is Euronext Paris.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:
(a) the Client is not a French Resident;
(b) the Client does not possess any Inside Information in respect of securities traded in
France involved in a Transaction;
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(c) where the Client is either (a) an individual who is not a citizen of a member state of
the European Union or of the Economic European Area that has signed a tax
agreement with France that contains an administrative assistance clause with a view to
combating tax fraud or tax evasion, (b) a corporate undertaking having its registered
office outside of a member state of the European Union or of the Economic European
Area that has signed a tax agreement with France that contains an administrative
assistance clause with a view to combating tax fraud or tax evasion, or (c) a French
individual who is not a French Resident, the Client (i) does not, as a result of any
Transaction(s), directly or indirectly hold, aggregated with existing holdings of securities
or assimilated rights, 33⅓% or more (or any other applicable percentage at the time of the
relevant Transaction(s)) of the share capital any issuer of French Securities operating in a
Class A Sensitive Sector or a Class B Sensitive Sector or (ii) has already duly complied
with and submitted to the relevant authorities any documentation required by the
applicable provisions in respect of foreign investments control, notably articles R.
153-1 and subsequent of the French Monetary and Financial Code;
(d) where the Client is either (a) an individual who is a citizen of a member state of the
European Union or of the Economic European Area that has signed a tax agreement
with France that contains an administrative assistance clause with a view to combating
tax fraud or tax evasion, (b) a corporate undertaking having its registered office in a
member state of the European Union or of the Economic European Area that has
signed a tax agreement with France that contains an administrative assistance clause
with a view to combating tax fraud or tax evasion, or (c) a French individual who is a
French Resident, the Client (i) does not, as a result of any Transaction(s), directly or
indirectly hold, aggregated with existing holdings of securities or assimilated rights, 50%
or more (or any other applicable percentage at the time of the relevant Transaction(s)) of
the share capital any issuer of French Securities operating in a Class B Sensitive Sector or
(ii) has already duly complied with and submitted to the relevant authorities any
documentation required by the applicable provisions in respect of foreign investments
control, notably articles R. 153-1 and subsequent of the French Monetary and
Financial Code;
(e) the Client (i) does not, as a result of any Transaction(s), directly or indirectly hold,
aggregated with existing holdings of securities or assimilated rights, 30% or more (or any
other applicable percentage at the time of the relevant Transaction(s)) of the share capital
and/or of the voting rights of any issuer whose French Securities are admitted to trading on
a Regulated Market which requires the implementation of a mandatory tender offer or
(ii) has already duly complied with and submitted to the relevant authorities any
documentation required by the applicable provisions in respect of mandatory tender
offers;
(f) the Client (i) does not, as a result of any Transaction(s), directly or indirectly hold,
aggregated with existing holdings of securities or assimilated rights, 50% or more (or any
other applicable percentage at the time of the relevant Transaction(s)) of the share capital
and/or of the voting rights of any issuer whose French Securities are admitted to trading on
a Multilateral Trading Facility which requires the implementation of a mandatory tender
offer or (ii) has already duly complied with and submitted to the relevant authorities
any documentation required by the applicable provisions in respect of mandatory
tender offers;
(g) the Client, where applicable, shall be responsible for all filings, notifications, reports
or other requirements in relation to Transactions, including, but not limited to,
(i) the disclosure of shareholding thresholds crossings pursuant to Article L. 233-
7 of the French Commercial Code;
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(ii) the disclosure of Transactions made by persons discharging managerial
responsibilities or persons closely associated with them, pursuant to Article 19
of the Market Abuse Regulation;
(iii) the filing with the Minister of Economy of a request for authorization of a
Transaction, pursuant to Articles L. 151-3 and R. 153-1 and subsequent of the
French Monetary and Financial Code;
(iv) the filing of the offer document (note d'information) regarding a tender offer,
pursuant to and in accordance with applicable provisions of the general
regulation (règlement general) of the Autorité des marches financiers (the
"AMF") and any instruction or recommendation published by the Autorité des
marches financiers;
(h) trading in Overseas Securities will be executed through one or more locally authorized
financial intermediary. The Client acknowledges that financial intermediaries
authorized in France pursuant to relevant laws and regulations and notably Articles L.
211-3 and L. 542-1 of the French Monetary and Financial Code (each a "French
Authorized Intermediary") are subject to the applicable provisions of the French
Monetary and Financial Code and are subject to the control of the AMF and/or the
Autorité de contrôle prudential et de résolution (the "ACPR"). The Client
acknowledges that such obligations may require ICBCIS to provide the French
Authorized Intermediaries with information about the Client and the Account,
including but not limited to, confidential information. The Client warrants that it will
not hold ICBCIS liable for any effect of providing such information to any French
Authorized Intermediary, the AMF or the ACPR.
2.2 The representations, warranties and undertakings in Clause 2.1 of this Annexure shall be
deemed to be repeated immediately before each Transaction or dealing is carried out for or any
service is provided to the Client or on the Client’s behalf.
2.3 If the Client is aware that any of the representations, warranties and undertakings in Clause 2.1
of this Annexure will or may become incorrect, the Client must give prior notice to ICBCIS
immediately upon the Client becoming aware of the same, and before such representations,
warranties and undertakings become incorrect. The Client must also notify ICBCIS
immediately if any of the said representations, warranties and undertakings has become
incorrect.
3. TAX
3.1 Tax risk factors
3.1.1 French financial transaction tax
The French Securities subject of the Transactions may fall within the scope of the French
financial transaction tax (the "French FTT"). As of the date of this Annexure and pursuant to
Article 235 ter ZD of the French Tax Code, the French FTT is applicable at the rate of 0.3%,
under certain circumstances, to the acquisition of equity securities (titres de capital) within the
meaning of Article L. 212-1 A of the French Monetary and Financial Code or assimilated
securities (titres de capital assimilés) within the meaning of Article L. 211-41 of the French
Monetary and Financial Code admitted to trading on a Regulated Market, which are issued by
a company whose registered office is located in France and whose market capitalization as of
December 1st of the preceding year exceeds €1 billion and provided that these acquisitions
give rise to a transfer of property within the meaning of Article L. 211-17 of the French
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Monetary and Financial Code. A list of the companies within the scope of the French FTT is
published every year.
With respect to acquisitions made as from 1 January 2018, Article 235 ter ZD of the French
Tax Code will no longer refer to the condition of the transfer of ownership within the meaning
of Article L. 211-17 of the French Monetary and Financial Code. As a consequence, as from 1
January 2018, the French FTT may apply to the acquisition of equity securities preceded or
followed by sales during the same day (also called intra-day transactions).
3.1.2 Proposed European financial transactions tax
The Client should be aware that the European Commission has published a proposal (the
"Commission’s Proposal") for a Directive on a common financial transaction tax (the
"European FTT") applicable to Austria, Belgium, Estonia, France, Germany, Greece, Italy,
Portugal, Slovenia, Slovakia and Spain) (the "Participating Member States"), which, if
enacted and implemented in France, would replace the French FTT.
On December 8, 2015 Estonia indicated that it will no longer be a Participating Member State.
Additional Member States of the European Union may decide to participate and/or other
Participating Member States may decide to withdraw.
The proposed European FTT might, if introduced in its current draft form, apply, under certain
circumstances, to certain dealings involving the French Securities. The European FTT might
apply to both residents and non-residents of the Participating Member States.
According to joint statements issued by the Ministers of Participating Member States the
implementation of the European FTT would be carried out progressively, focusing initially on
the taxation of shares and some derivatives. The European FTT proposal remains however
subject to discussion between the Participating Member States. It may therefore be altered
prior to any implementation. Additional European Union Member States may decide to
participate. Such taxes could increase the Transactions costs.
The Client should be aware that the position of the French FTT and the European FTT is
subject to change from time to time and ICBCIS shall not, and is not obliged to, provide an
update on the development of tax positions which may affect the Client. The Client is advised
to consult its usual tax advisor on the potential consequences of the French FTT and of the
European FTT.
3.2 Withholding taxes and other taxes applicable to French Securities applicable to persons who
are not French Residents
This sub-section describes the withholding tax regime that could apply, under French law as of
the date of this Annexure and subject to the provisions of double tax treaties, to dividends paid
by issuers of French Securities to individual and corporate shareholders who (i) are not French
Residents and (ii) do not own the French Securities through a fixed place of business or a
permanent establishment liable to tax in France. However, the Client should seek advice from
its usual tax advisor about the tax treatment that will apply to its own situation.
Under the French legislation in force as of the date of this Annexure and subject to the
application of any double tax treaty and the exceptions referred to below, dividends paid by
issuers of French Securities are generally subject to a withholding tax, levied by the paying
agent, when the tax residence or registered office of the beneficial owner is outside France.
Subject to what is stated below, the rate of such withholding tax is:
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(a) 21% when the beneficial owner is an individual whose tax residence is in a European
Union member state or a European Economic Area member state that has signed a tax
agreement with France that contains an administrative assistance clause with a view to
combating tax fraud or tax evasion and if the dividends are eligible to the allowance of
40% provided by Article 158, 3. 2° of the French Tax Code;
(b) 15% when the beneficial owner is an organization whose registered office is in a
European Union member state or a European Economic Area member state that has
signed a tax agreement with France that contains an administrative assistance clause
with a view to combating tax fraud or tax evasion, and that would, if it had its
registered office in France, be taxed in accordance with the special tax regime set forth
in paragraph 5 of Article 206 of the French Tax Code (which refers to organisms
generally referred to as “non-profit organizations” (organismes sans but lucratif)) as
construed by paragraphs 580 et seq. of administrative guidelines BOI-IS-CHAMP-10-
50-10-40-20130325 and relevant case law; and
(c) 30% in all other cases.
However, regardless of the beneficial owner's tax residence or place of residence or registered
office, subject to the provisions of any double tax treaties, the dividends paid by issuers of
French Securities outside France in a NCST will be subject to withholding tax at the rate of
75%. The list of NCSTs is published by decree and is updated annually.
The withholding tax may be reduced or eliminated, in particular pursuant to (i) Article 119 ter
of the French Tax Code which is applicable, under certain conditions, to corporate
shareholders which have their effective place of management in a European Union member
state or a European Economic Area member state that has signed a tax agreement with France
that contains an administrative assistance clause with a view to combating tax fraud or tax
evasion, are subject to corporate tax in this state, hold at least 10% of the capital of the issuer
of French Securities during two years and fulfil the other requirements set forth in the above-
mentioned article, this percentage being reduced to 5% for corporate shareholders which fulfil
the requirements set forth in Article 145 of the French Tax Code and cannot benefit from a tax
credit for the French withholding tax in their country of tax residence, (ii) Article 119
quinquies of the French Tax Code if the company which receives the distribution has its
effective management in a member state of the European Union or in a third-party state which
has concluded with France a convention on mutual administrative assistance to combat tax
evasion and avoidance and which is subject to corporate tax in this state, the taxable earning of
the company is a loss in respect of the fiscal year during which distributions were released,
and as of the date of distribution, the issuer of French Securities has been under a procedure
which is similar to the French compulsory liquidation procedure or to (iii) any double tax
treaties that may apply.
In addition, the withholding tax is not applicable to dividends paid to certain mutual
investment funds incorporated under the laws of a foreign jurisdiction that (i) are based in an
member state of the European Union or in another state or territory that has signed a tax
agreement with France that contains an administrative assistance clause with a view to
combating tax fraud or tax evasion fulfilling the requirements of Article 119 bis 2 of the
French Tax Code, (ii) raise capital from a certain number of investors in order to invest for the
interest of those investors, in accordance with a defined investment policy, and (iii) have
characteristics similar to those required of collective undertakings fulfilling the conditions set
forth under Article 119 bis 2 of the French Tax Code and in the administrative guidelines BOI-
RPPM-RCM-30-30-20-70-20170607.
The Client should be aware that the position set out in this Clause of this Annexure is subject
to change from time to time and ICBCIS shall not, and is not obliged to, provide an update on
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the development of tax positions which may affect the Client. The Client is advised to consult
its usual tax advisor in order to determine the modalities according to which these provisions
may apply to its own situation.
The Client is advised to seek professional advice from its usual tax advisor to determine
whether it is likely to be subject to the legislation on NCSTs and/or to be able to claim the
right to benefit from a reduction of or an exemption from the withholding tax, and to define
the practical procedures to be applied therewith, including, without limitation, those set out in
administrative guidelines BOI-INT-DG-20-20-20-20-20120912 relating to the so-called
"standard" and "simplified" procedures for the reduction of and exemption from withholding
tax as regards double tax treaties.
Where the Client is not a French Resident, the Client must also comply, in connection with the
dividends paid by issuers of French Securities, with the tax legislation in force in their state of
tax residence, as amended by any double tax treaty entered into by France and that state from
time to time.
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Annexure 5
UK
This Annexure applies in respect of securities trading services in UK Securities (as defined below)
provided by ICBCIS to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for
Overseas Securities Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in UK Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"Acting in concert" has the meaning given in the Takeover Code;
"Applicable Laws and Regulations" means the FCA Rules and all other UK applicable laws,
rules and regulations in force from time to time which apply to the Agreement;
"Authorised Person" means a person authorised to carry on regulated activities under the
FSMA;
"CJA" means the UK Criminal Justice Act 1993;
"DTR" means the Disclosure, Guidance and Transparency Rules of the FCA;
"FCA" means the UK Financial Conduct Authority or any successor body or authority that
assumes relevant functions of the FCA;
"FSMA" means the UK Financial Services and Markets Act 2000;
"Inside Information" means inside information in respect of an Relevant Issuer within the
meaning of (i) Article 7 of the Market Abuse Regulation and/or (ii) Section 56 of the CJA;
"LSE" means London Stock Exchange plc which trades as the “London Stock Exchange”
including, where the context so permits, any committee, sub-committee, employee or officer
to whom any function of London Stock Exchange plc may for the time being be delegated;
"Market Abuse" means any conduct that would amount to insider dealing or market
manipulation pursuant to Market Abuse Regulation, the CJA or the UK Financial Services Act
2012;
"Market Abuse Regulation" means regulation (EU) n° 596/2014 of the European Parliament
and of the Council of 16 April 2014 on market abuse;
"MiFID 1" means Directive 2004/39/EC of the European Parliament and of the Council on
markets in financial instruments and amending Council Directives 85/611/EEC and 93/6/EEC
and Directive 2000/12/EC of the European Parliament and of the Council and repealing
Council Directive 93/22/EEC;
"MiFID 2" means Directive 2014/6/EU of the European Parliament and of the Council of 15
May 2014 on markets in financial instruments and amending Directive 2002/92/EC and
Directive 2011/61/EU (recast);
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"MiFIR" means Regulation 2014/600/EU of the European Parliament and of the Council on
markets in financial instruments and amending Regulation (EU) No 648/2012;
"MiFIR Transaction Reporting RTS" means Commission Delegated Regulation (EU) 2017
590 of 28 July 2016;
"PDMR" means a person discharging managerial responsibilities in respect of a Relevant
Issuer within the meaning of the Market Abuse Regulation or a person closely associated with
such a person;
"Relevant Issuer" means an issuer of UK Securities;
"Short Selling Regulation" means Regulation 236/2012/EU on short selling and certain
aspects of credit default swaps;
"Takeover Code" means the City Code on Takeovers and Mergers;
"UK Multilateral Trading Facility" means a multilateral trading facility as defined under
MiFID 1 or MiFID 2 the operator of which has its head office located within the United
Kingdom;
"UK Regulated Market" means a regulated market within the meaning of MiFID 1 or MiFID
2 for which the United Kingdom is the Home Member State; and
"UK Securities" means shares, stocks or other equity securities or debt securities listed on the
Official List of the UK Listing Authority and/or admitted to trading on the LSE (including the
Main Market and AIM) or any other UK Regulated Market or UK Multilateral Trading
Facility.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:
(a) the Client is not a UK Resident;
(b) in respect of the UK Securities being traded as part of any Transaction, the Client
either (i) does not possess any Inside Information or (ii) if it possesses Inside
Information, shall not enter into a Transaction whilst in possession of such Inside
Information other than in circumstances in which doing so would not contravene the
CJA or the Market Abuse Regulation;
(c) the Client (i) is not a PDMR of the Relevant Issuer or (ii) is a PDMR of the Relevant
Issuer shall comply with (f) below;
(d) the Client (together with any persons with whom it is Acting in Concert) (i) would not, as a result of any Transaction(s), directly or indirectly hold, an interest in UK Securities
carrying 30% or more (or other applicable thresholds as imposed under the Takeover Code)
of the voting rights of any Relevant Issuer or (ii) has complied with, and will continue to
comply with, all applicable provisions of the Takeover Code in respect of mandatory
offers;
(e) the Client, where applicable, shall comply with and be responsible for all filings,
notifications, reports or other requirements in relation to Transactions, including, but
not limited to,
(i) disclosures required under the DTR;
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(ii) the disclosure of Transactions made by PDMRs, pursuant to Article 19 of the
Market Abuse Regulation;
(iii) disclosures of short sales of UK Securities required under the Short Selling
Regulation;
(iv) the approval of the FCA or Prudential Regulation Authority for any
Transaction constituting an acquisition of or an increase "control" over an
Authorised Person pursuant to Part XII of FSMA, and a notification to the
FCA or PRA where required under FSMA in the case of any Transaction
resulting in a reduction or cessation of control over an Authorised Person; and
(v) the filing of any document, the making of any announcement or other
disclosure required under the Takeover Code;
(f) the Client is not engaged in and shall not engage in Market Abuse;
(g) trading in UK Securities will be executed through one or more Authorised Persons.
The Client acknowledges that Authorised Persons and the LSE are subject to
Applicable Laws and Regulations, compliance with which will require ICBCIS to
provide information about the Client and the Account, including but not limited to,
information required in order to comply with transaction reporting obligations under
MiFID 2 and MiFIR. Such information may include confidential information and
personal data, and may where the Client is a legal entity include a Legal Entity
Identifier or where the Client is a natural person may include the designation resulting
from the concatenation of the ISO 3166-1 alpha -2 or other personal information
specified in Article 6 of the MiFIR Transaction Reporting RTS;
(h) the Client shall not engage in trading of UK Securities in any Transaction where such
trade would breach Rule 4 (Restrictions on Dealings) or any other provision of the
Takeover Code;
(i) the Client shall not engage in trading of UK Securities in any Transaction where such
Transaction would breach the Short Selling Regulation;
(j) the Client shall not engage in trading of UK Securities in any Transaction where such
Transaction would require the prior approval or consent of any merger control, anti-
trust or competition authority including, without limitation, the UK Competition and
Markets Authority (and any successor body) and the EU Commission (unless such
prior approval or consent has been duly obtained);
(k) the Client has familiarised itself with the constitutional documents of any Relevant
Issuer in whose UK Securities it proposes to trade and shall not engage in trading of
UK Securities in any Transaction where such Transaction would require the prior
approval or consent of any person or body (unless such prior approval or consent has
been duly obtained); and
(l) the Client is (i) in compliance with all Applicable Laws and Regulations in respect of
anti-money laundering and counter-terrorist financing and (ii) is not a designated
person listed under EU or UK trade or financial sanctions regimes, and (ii) is not listed
on the Consolidated List of Financial Sanctions Targets maintained by HM Treasury.
2.2 The representations, warranties and undertakings in Clause 2.1 of this Annexure shall be
deemed to be (i) made on behalf of any ultimate beneficial owner on whose behalf the Client
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acts and (ii) repeated immediately before each Transaction or dealing is carried out for or any
service is provided to the Client or on the Client’s behalf.
2.3 If the Client is aware that any of the representations, warranties and undertakings in Clause 2.1
of this Annexure will or may become incorrect, the Client must give prior notice to ICBCIS
immediately upon the Client becoming aware of the same, and before such representations,
warranties and undertakings become incorrect. The Client must also notify ICBCIS
immediately if any of the said representations, warranties and undertakings has become
incorrect.
3. TAX
3.1 Tax risk factors
This Clause 3 provides a general summary of certain UK tax considerations relating to the
ownership and disposal of the UK Securities. It is based on current UK tax law and published
HM Revenue & Customs ("HMRC") practice as at the date of this Annexure, both of which
are subject to change at any time, possibly with retrospective effect. It applies only to holders
of UK Securities who are not resident (and, in the case of individuals, not resident and
domiciled) in the UK for tax purposes and who do not have a permanent establishment, branch,
agency or fixed base in the UK through which the UK Securities are acquired, held or used
("non-UK Holders"). This Clause 3 applies to those UK Securities that relate to companies
that are resident for tax purposes only in the UK.
Withholding Tax
3.2 Dividend payments in respect of the UK Securities are made without withholding for UK tax,
or deduction on account of UK tax.
Receipt of Dividends
3.3 A non-UK Holder of the UK Securities residing outside the UK may be subject to taxation on
dividend income under applicable local law. Such holders should consult their own tax adviser
concerning their tax position on dividends received in respect of the UK Securities.
Taxation of Disposals
3.4 A non-UK Holder of the UK Securities residing outside the UK may be subject to taxation on
disposal of UK Securities under applicable local law. Such holders should consult their own
tax adviser concerning their tax position on disposals of UK Securities.
Stamp Duty Reserve Tax
3.5 Paperless transfers of the UK Securities within CREST may be liable to UK Stamp Duty
Reserve Tax ("SDRT") at the rate of 0.5% of the amount or value of the consideration (or such
other rate as may be applicable from time to time under the UK laws). CREST is obliged to
collect SDRT on relevant transactions settled within the system. Under the CREST system, no
SDRT will arise on a transfer of the UK Securities into the system unless such a transfer is
made for a consideration in money or money's worth, in which case a liability to SDRT
(usually at a rate of 0.5%) will arise.
Inheritance Tax
3.6 The UK Securities will be assets situated in the United Kingdom for the purposes of UK
inheritance tax. A gift of such assets by, or the death of, an individual holder of such assets
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may (subject to certain exemptions and reliefs) give rise to a liability to UK inheritance tax
even if the holder is neither domiciled in the United Kingdom nor deemed to be domiciled
there under certain rules relating to long residence or previous domicile. For inheritance tax
purposes, a transfer of assets at less than full market value may be treated as a gift and
particular rules apply to gifts where the donor reserves or retains some benefit.
3.7 Special rules also apply to close companies and to trustees of settlements who hold UK
Securities, bringing them within the charge to inheritance tax. Non-UK Holders should consult
an appropriate tax adviser if they intend to make a gift or transfer at less than market value or
intend to hold any UK Securities through trust arrangements.
3.8 The Client should be aware that the position set out in this Annexure is subject to change from
time to time and ICBCIS shall not, and is not obliged to, provide an update on the
development of tax positions which may affect the Client. The Client is advised to consult its
own tax advisor on potential consequences.
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Annexure 6
Germany
This Annexure applies in respect of securities trading services in German Securities (as defined below)
provided by ICBCIS to the Client, and is supplemental to Clauses 1 to 15 of the Appendix for
Overseas Securities Trading.
In the event that there is any inconsistency between Clauses 1 to 15 of the Appendix for Overseas
Securities Trading and this Annexure, the provisions in this Annexure shall prevail in respect of
trading in German Securities.
Unless otherwise defined in this Annexure, terms defined in the Appendix for Overseas Securities
Trading shall have the same meaning when used in this Annexure.
1. DEFINITIONS
1.1 In this Annexure, the following terms shall have the following meanings:
"Acting in concert" has the meaning given in sec. 30(2) WpÜG:
"Applicable Laws and Regulations" means the all German and EU applicable laws, rules and
regulations in force from time to time which apply to the Agreement;
"AWG" means the German Foreign Business Act (Außenwirtschaftsgesetz);
"BaFin" means the German Federal Financial Supervisory Authority (Bundesanstalt für
Finanzdienstleistungsaufsicht);
"BMWi" means the German Federal Ministry of the Economy
(Bundeswirtschaftsministerium);
"EU" means the European Union;
"FSE" means the Frankfurt Stock Exchange (Frankfurter Wertpapierbörse) operated by
Deutsche Börse AG as the FSE's carrier enterprise (Trägerunternehmen);
"German Multilateral Trading Facility" means a multilateral trading facility as defined
under MiFID 1 or MiFID 2 the operator of which has its head office located within Germany;
"German Regulated Market" means a regulated market within the meaning of MiFID 1 or
MiFID 2 for which Germany is the Home Member State;
"German Resident" means resident of Germany for tax purposes, i.e. either an individual
having his or her place of residence or habitual abode within the meaning of sec. 8 and 9 of the
German Fiscal Code (Abgabenordnung) in Germany or a corporation having its registered seat
or place of management within the meaning of sec. 10 and 11 of the German Fiscal Code in
Germany;
"German Securities" means shares, stocks or other equity securities or debt securities listed
in the regulated market (regulierter Markt) on the FSE (including the General Standand and
Prime Standard Segments) or included in the trading in the Open Market (Freiverkehr) of the
FSE or any other German Regulated Market or German Multilateral Trading Facility.
"Inside Information" means inside information in respect of an Relevant Issuer within the
meaning of (i) Article 7 of the Market Abuse Regulation;
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"Market Abuse" means any conduct that would amount to insider dealing or market
manipulation pursuant to Market Abuse Regulation;
"Market Abuse Regulation" means regulation (EU) n° 596/2014 of the European Parliament
and of the Council of 16 April 2014 on market abuse;
"MiFID 1" means Directive 2004/39/EC of the European Parliament and of the Council on
markets in financial instruments and amending Council Directives 85/611/EEC and 93/6/EEC
and Directive 2000/12/EC of the European Parliament and of the Council and repealing
Council Directive 93/22/EEC;
"MiFID 2" means Directive 2014/6/EU of the European Parliament and of the Council of 15
May 2014 on markets in financial instruments and amending Directive 2002/92/EC and
Directive 2011/61/EU (recast);
"MiFIR" means Regulation 2014/600/EU of the European Parliament and of the Council on
markets in financial instruments and amending Regulation (EU) No 648/2012;
"MiFIR Transaction Reporting RTS" means Commission Delegated Regulation (EU) 2017
590 of 28 July 2016;
"Non-German Resident" means a person not qualifying as German Resident;
"PDMR" means a person discharging managerial responsibilities in respect of a Relevant
Issuer within the meaning of the Market Abuse Regulation or a person closely associated with
such a person;
"Permanent Establishment" has the meaning given in sec. 12 and 13 of the German Fiscal
Code and includes, therefore, a permanent representative;
"Relevant Issuer" means an issuer of German Securities;
"Short Selling Regulation" means Regulation 236/2012/EU on short selling and certain
aspects of credit default swaps;
"WpAV" means the German Securities Trading Notification Ordinance
(Wertpapierhandelsanzeigeverordnung);
"WpHG" means the German Securities Trading Act (Wertpapierhandelsgesetz); and
"WpÜG" means the German Securities Acquisition and Takeover Act (Wertpapierwerbs- und
Übernahmegesetz).
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
2.1 The Client provides the following warranties, representations and undertakings to ICBCIS
which shall be supplemental to Clause 8.1 of the Appendix for Overseas Securities Trading:
(a) the Client is not a German Resident;
(b) in respect of the German Securities being traded as part of any Transaction, the Client
either (i) does not possess any Inside Information or (ii) if it possesses Inside
Information, shall not enter into a Transaction whilst in possession of such Inside
Information other than in circumstances in which doing so would not contravene the
Market Abuse Regulation;
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(c) the Client (i) is not a PDMR of the Relevant Issuer or (ii) is a PDMR of the Relevant
Issuer who shall comply with (e) (ii) below;
(d) the Client (together with any persons with whom it is Acting in Concert) (i) would not,
as a result of any Transaction(s), directly or indirectly hold, an interest in German
Securities carrying 30% or more (or other applicable thresholds as imposed under the
WpÜG) of the voting rights of any Relevant Issuer or (ii) has complied with, and will
continue to comply with, all applicable provisions of the WpÜG in respect of
mandatory offers;
(e) the Client, where applicable, shall comply with and be responsible for all filings,
notifications, reports or other requirements in relation to Transactions, including, but
not limited to,
(i) disclosures required under the WpHG and the WpAV;
(ii) the disclosure of Transactions made by PDMRs, pursuant to Article 19 of the
Market Abuse Regulation;
(iii) disclosures of short sales of German Securities required under the Short
Selling Regulation; and
(iv) the filing of any document, the making of any announcement or other
disclosure required under the WpÜG;
(f) the Client is not engaged in and shall not engage in Market Abuse;
(g) trading in German Securities will be executed through one or more locally authorized
financial intermediaries or trading venues. The Client acknowledges that such
financial intermediaries and trading venues where the trades are executed are subject
to Applicable Laws and Regulations, compliance with which will require ICBCIS to
provide information about the Client and the Account, including but not limited to,
information required in order to comply with transaction reporting obligations under
MiFID 2 and MiFIR. Such information may include confidential information and
personal data, and may where the Client is a legal entity include a Legal Entity
Identifier or where the Client is a natural person may include the designation resulting
from the concatenation of the ISO 3166-1 alpha -2 or other personal information
specified in Article 6 of the MiFIR Transaction Reporting RTS. The Client further
acknowledges that without such information, it may not be possible to execute the
trade;
(h) the Client shall not engage in trading of German Securities in any Transaction where
such Transaction would breach the Short Selling Regulation or any other Applicable
Laws and Regulations;
(i) the Client shall not engage in trading of German Securities in any Transaction where
such Transaction would require the prior approval or consent of any merger control,
anti-trust or competition authority including, without limitation, the German
Competition and Markets Authority (and any successor body) and the EU Commission
(unless such prior approval or consent has been duly obtained);
(j) the Client shall not engage in trading of German Securities in any Transaction where
such transaction would require the approval or consent of any supervisory authority
under ownership control or similar proceedings including without limitation the BaFin
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and the European Central Bank (unless such prior approval or consent has been duly
obtained);
(k) the Client shall not engage in trading of German Securities in any Transaction where
such transaction would require the sector-specific approval or consent of any
competent foreign investment authority including without limitation the BMWi under
the AWG (unless such prior approval or consent has been duly obtained);
(l) the Client has familiarised itself with the constitutional documents of any Relevant
Issuer in whose German Securities it proposes to trade and shall not engage in trading
of German Securities in any Transaction where such Transaction would require the
prior approval or consent of any person or body (unless such prior approval or consent
has been duly obtained); and
(m) the Client is (i) in compliance with all Applicable Laws and Regulations in respect of
anti-money laundering and counter-terrorist financing and (ii) is not a designated
person listed under EU or German trade or financial sanctions regimes, and (ii) is not
listed on the Consolidated List of Financial Sanctions Targets (Finanzsanktionsliste)
maintained by the German federal and state judiciary (www.finanz-sanktionsliste.de).
2.2 The representations, warranties and undertakings in Clause 2.1 of this Annexure shall be
deemed to be (i) made on behalf of any ultimate beneficial owner on whose behalf the Client
acts and (ii) repeated immediately before each Transaction or dealing is carried out for or any
service is provided to the Client or on the Client’s behalf.
2.3 If the Client is aware that any of the representations, warranties and undertakings in Clause 2.1
of this Annexure will or may become incorrect, the Client must give prior notice to ICBCIS
immediately upon the Client becoming aware of the same, and before such representations,
warranties and undertakings become incorrect. The Client must also notify ICBCIS
immediately if any of the said representations, warranties and undertakings has become
incorrect.
3. TAX
3.1 This Clause 3 provides a general summary of certain German tax considerations relating to the
ownership and disposal of the German Securities. It is based on current German tax law as at
the date of this Annexure, both of which are subject to change at any time, possibly with
retrospective effect. It applies only to holders of German Securities who are Non-German
Resident and who do not have a Permanent Establishment in Germany through which the
German Securities are acquired, held or used ("Non-German Holders"). This Clause 3
applies to those German Securities that relate to or issued by German Resident companies only.
Taxation of dividends
3.2 Dividends are subject to a deduction at source (withholding tax) at a 25% rate plus a solidarity
surcharge of 5.5% on the amount of withholding tax (amounting in total to a rate of 26.375%)
and church tax (Kirchensteuer), if applicable. The basis for determining the dividend
withholding tax is the dividend approved for distribution by the relevant company’s
shareholders’ meeting. In general, dividend withholding tax is withheld regardless of whether
and, if so, to what extent the shareholder must report the dividend for tax purposes and
regardless of whether the shareholder is a resident of Germany or of a foreign country.
The dividend withholding tax rate for dividends paid to Non-German Resident shareholders
may be reduced up to 0% in accordance with the EU Parent-Subsidiary Directive or any
applicable double taxation treaty between Germany and the relevant shareholder’s country of
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residence under certain circumstances. For the reduced withholding tax rate to be applicable,
the shareholder has to apply for an exemption from the Federal Central Office of Taxation
(Bundeszentralamt für Steuern) with address at An der Küppe 1, 53225 Bonn, Germany. The
full exemption from the German dividend withholding tax generally requires that the relevant
corporate shareholder has directly held at least 10% of the Company’s registered share capital
and that certain further prerequisites are met. Forms for the refund and exemption procedure
may be obtained from the Federal Central Office of Taxation (Bundeszentralamt für Steuern),
as well as German embassies and consulates.
Non-German Resident corporations will upon application receive a refund of two fifths of the
dividend withholding tax that was withheld and remitted to the tax authorities subject to
certain requirements. This applies regardless of any further reduction or exemption provided
for under the EU Parent-Subsidiary Directive or a double taxation treaty. Foreign corporations
will generally have to meet certain stringent substance criteria defined by statute in order to
receive a (partial) exemption from, or (partial) refund of, German dividend withholding tax.
Shareholders that are individuals and do not hold the shares as business assets may apply for
exemption from dividend withholding tax to the extent such shareholder's capital income for
all types of capital income does not exceed the annual lump-sum allowance of EUR 801 (or
EUR 1,602 for jointly filing individuals).
Dividends paid to Non-German Resident shareholders maintaining a Permanent Establishment
in Germany and holding the shares as part of business assets of such Permanent Establishment
are subject to income taxation in Germany. The withholding tax (including solidarity
surcharge) will generally be credited against the respective shareholder's personal income tax
or corporate income tax liability, and any overpayment will be refunded.
The Client should seek own professional advice as to whether he can obtain a tax credit or tax
refund with respect to withholding taxes on dividends.
A Non-German Holder of the German Securities may be subject to taxation on dividend
income under applicable local law. Such holders should consult their own tax adviser
concerning their tax position on dividends received in respect of the German Securities.
Taxation of Capital gains
3.3 Capital gains realized by a Non-German Resident shareholder are only subject to German
income tax if the selling shareholder held a participation of at least 1% of the share capital of a
German company at any point of time during the five years preceding the disposal or if the
shares form part of the business assets of a Permanent Establishment in Germany.
Most double taxation treaties provide for an exemption from German taxes and assign the right
of taxation to the shareholder’s country of tax residence in the former case.
Inheritance Tax
3.4 The transfer of shares to another person by inheritance or gift is generally only subject to
German inheritance or gift tax if:
(a) the decedent, donor, heir, beneficiary or other transferee maintained his domicile or
habitual abode in Germany, or had its place of management or registered office in
Germany at the time of the transfer, or is a German citizen who has spent no more than
five consecutive years (this term is extended to ten years for German expatriates with
residence in the United States) prior to the transfer outside Germany without
maintaining a residence in Germany (special rules apply to certain former German
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citizens who neither maintain their domicile nor have their habitual abode in
Germany); or
(b) the shares were held by the decedent or donor as part of business assets for which a
Permanent Establishment was maintained in Germany; or
(c) the decedent or donor, either individually or collectively with related parties, held,
directly or indirectly, at least 10% of the Company’s registered share capital at the
time of the inheritance or gift.
The few German double taxation treaties relating to inheritance tax and gift tax currently in
force usually provide that the German inheritance tax or gift tax can only be levied in the cases
of (a). above, and also with certain restrictions in case of (b) above. Special provisions apply
to certain German nationals living outside Germany and former German nationals.
3.5 The Client should be aware that the position set out in this Annexure is subject to change from
time to time and ICBCIS shall not, and is not obliged to, provide an update on the
development of tax positions which may affect the Client. The Client is advised to consult its
own tax advisor on potential consequences.