Summary policy of conflicts of interest
This statement summarises CMC Markets UK plc’s and CMC Markets Canada Inc.’s (together referred to as “CMC Markets”) conflicts of interest policy (“Policy”). CMC Markets for these purposes includes its group companies, employees, appointed representatives, tied agents, contractors or any person directly or indirectly linked to them by control.
CMC Markets sets out to manage conflicts of interest fairly. CMC Markets has established a conflicts of interest policy setting out the procedures and controls which help it identify and appropriately deal with conflicts of interest – actual, apparent and potential.
The objective of this Policy is to ensure that conflicts of interest within CMC Markets are identified, managed appropriately and, where necessary, disclosed in order to ensure the fair treatment of clients and compliance with the rules and principles of the Financial Conduct Authority (“FCA”), Canadian Securities Administrators and the Investment Industry Regulatory Organization of Canada.
This policy applies to all CMC Markets regulated activities, and activities in connection with or for the purposes of such regulated activities, including those outsourced activities provided by a third party. All employees are required to comply with this Policy.
Conflicts of Interest Identification
CMC Markets has systems and protocols in place to identify potential conflicts of interest. Once a conflict has been identified, procedures are implemented to ensure it is appropriately managed. A potential conflict occurs where competing obligations or motivations result in, or are likely to result in, material risk of damage to the interests of a client, including where:
- CMC Markets is likely to make a financial gain, or avoid a financial loss, at the expense of the client;
- A CMC Markets employee is likely to make a financial gain, or avoid a financial loss, at the expense of the client; or
- A client of CMC Markets is likely to make financial gain or avoid a financial loss at the expense of another client.
Arrangements to Manage Conflicts
CMC Markets has established procedures which are designed to identify and manage conflicts of interests. These include a number of organisational and administrative arrangements to safeguard the interests of clients and minimise the potential for conflicts to arise.
CMC Markets adopts a number of approaches to manage conflicts of interest and control the movement of confidential information. The following is a non-exhaustive list of these controls:
- Segregation of duties and supervision for persons engaged in different business activities including procedures for ensuring appropriate communication between business units;
- Personal account dealing restrictions applicable to all staff, and their associates, regardless of seniority;
- Control over sources of remuneration of relevant persons;
- Protocols to ensure that no improper inducements are given or received and proper inducements are disclosed appropriately
- Gifts and personal benefits procedures including a gift register recording the solicitation, offer or receipt of certain benefits;
- External directorship policy, including the requirement for all external directorships and outside business interests to be declared; and
- The provision of training to directors and employees of CMC Markets on conflicts of interest management.
Where CMC Markets considers, with reasonable confidence, that the arrangements in place to manage potential and/or actual conflicts of interest are not sufficient to avoid material risk of damage to a client’s interest, CMC Markets will disclose the general nature and/or sources of the conflict of interest to the client before undertaking any business for the client.
Disclosure Regarding Overseas Support Providers
CMC Markets UK Plc and its affiliates (the "Overseas Service Providers") may provide clients with certain support services including the ability to execute trades via telephone. Whilst the Overseas Service Providers are registered in their home jurisdictions and have to comply with applicable local regulations, they are not registered with any Canadian securities regulator as a dealer in the category of investment dealer. Therefore, the investor protections available under Canadian securities laws may not be available to clients. However, nothing in this paragraph should be read to detract from the investor protections available to a client of CMC Markets Canada Inc., which is a registered investment dealer in Canada.
Please be advised that it may be difficult to enforce any legal rights against the Overseas Service Providers because they are resident outside of Canada and all or substantially all of their assets are located outside of Canada.