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  • COB 3 COB 3 Core Rules — Investment Business, Accepting Deposits, Providing Credit, Providing Trust Services, Operating a Crowdfunding Platform, Operating An Employee Money Purchase Scheme And Acting As The Administrator Of An Employee Money Purchase Scheme

    • COB 3 Guidance

      1. The Rules in this chapter give support to the Principles in GEN section 4.2 and in particular Principles 1, 2, 6 and 7.
      2. There are additional Rules that apply to Authorised Firms in other chapters of this module, which are more specific to the nature of the Financial Service conducted by the Authorised Firm.
      Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 3.1 COB 3.1 Application

      • COB 3.1.1

        This chapter applies to an Authorised Firm which carries on or intends to carry on:

        (a) Investment Business;
        (b) Accepting Deposits;
        (c) Providing Credit;
        (d) Providing Trust Services;
        (e) Operating a Crowdfunding Platform;
        (f) Operating an Employee Money Purchase Scheme;
        (g) Acting as the Administrator of an Employee Money Purchase Scheme;
        (h) Providing Money Services; or
        (i) Arranging or Advising on Money Services.

        except where it is expressly provided otherwise.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
        [Amended] DFSA RMI202/2017 (Made 14th June 2017). [VER29/08-17]
        [Amended] DFSA RMI261/2019 (Made 18th December 2019). [VER35/01-20]
        [Amended] DFSA RMI267/2020 (Made 26th February 2020). [VER36/04-20]

    • COB 3.2 COB 3.2 Communication of Information and Marketing Material

      • General

        • COB 3.2.1

          When communicating information to a Person in relation to a financial product or financial service, an Authorised Firm must take reasonable steps to ensure that the communication is clear, fair and not misleading.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 3.2.2

          An Authorised Firm must not, in any form of communication with a Person, including an agreement, attempt to limit or avoid any duty or liability it may have to that Person or any other Person under legislation administered by the DFSA.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM154/2015 (Made 9th December 2015) [VER25/02-16]

        • COB 3.2.3

          Where a Rule in COB requires information to be sent to a Client, the Authorised Firm must provide that information directly to the Client and not to another Person, unless it is on the written instructions of the Client.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • Guidance

          In Rule 3.2.2, a communication would include a financial promotion, a client agreement, terms of business, financial product terms and conditions, a mandate, power of attorney entered into for the purposes of a financial service or product and any other communication which relates in whole or in part to the provision of a financial service or product.

          Derived from DFSA RM154/2015 (Made 9th December 2015) [VER25/02-16]

      • Marketing Material

        • COB 3.2.4

          (1) An Authorised Firm must ensure that any marketing material communicated to a Person contains the following information:
          (a) the name of the Authorised Firm communicating the marketing material or, on whose behalf the marketing material is being communicated;
          (b) the Authorised Firm's regulatory status as required under GEN section 6.4; and
          (c) if the marketing material is intended only for Professional Clients or Market Counterparties, a clear statement to that effect and that no other Person should act upon it.
          (2) In (1), marketing material includes any invitation or inducement to enter into an agreement:
          (a) in relation to a financial product or to engage in a Financial Service with the Authorised Firm; or
          (b) in relation to a financial product or financial service offered by a Person other than the Authorised Firm.
          (3) An Authorised Firm which communicates marketing material in (2)(b) must:
          (a) ensure that the marketing material complies with the applicable Rules and any legislation administered by the DFSA; and
          (b) not distribute such marketing material if it becomes aware that the Person offering the financial product or financial service to which the material relates is in breach of the regulatory requirements that apply to that Person in relation to that product or service.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DSFA RM185/2016 (Made 7th December 2016). [VER28/02-17]

        • COB 3.2.5

          An Authorised Firm must take reasonable steps to ensure that:

          (a) any marketing material intended for Professional Clients is not sent or directed to any Persons who are not Professional Clients; and
          (b) no Person communicates or otherwise uses the marketing material on behalf of the Authorised Firm in a manner that amounts to a breach of the requirements in this section.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Past Performance and Forecasts

        • COB 3.2.6 COB 3.2.6

          An Authorised Firm must ensure that any information or representation relating to past performance, or any future forecast based on past performance or other assumptions, which is provided to or targeted at Retail Clients:

          (a) presents a fair and balanced view of the financial products or financial services to which the information or representation relates;
          (b) identifies, in an easy to understand manner, the source of information from which the past performance is derived and any key facts and assumptions used in that context are drawn; and
          (c) contains a prominent warning that past performance is not necessarily a reliable indicator of future results.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

          • COB 3.2.6 Guidance

            In presenting information relating to past performance of a financial product or financial service, the Authorised Firm should follow, to the extent relevant, the Global Investment Performance Standards (GIPS) issued by Institute of Chartered Financial Analysts of the USA or a reputable independent actuarial, financial or statistical reporting service provider.

            Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 3.3 COB 3.3 Key Information and Client Agreement

      • Application

        • COB 3.3.1

          The Rules in this section do not apply to an Authorised Firm when it is:

          (a) carrying on a Financial Service with or for a Market Counterparty;
          (b) Accepting Deposits;
          (c) Providing Credit;
          (d) carrying on an activity of the kind described in GEN Rule 2.26.1 that constitutes marketing;
          (e) a Fund Manager of a Fund Offering the Units of a Fund it manages;
          (f) Operating an Employee Money Purchase Scheme;
          (g) Acting as the Administrator of an Employee Money Purchase Scheme; or
          (h) an ATS Operator.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER17/01-10]
          [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER19/07-10]
          [Amended] DFSA RMI261/2019 (Made 18th December 2019). [VER35/01-20]
          [Amended] DFSA RMI311/2021 (Made 30th June 2021). [VER39/10-21]

        • COB 3.3.2 COB 3.3.2

          (1) Subject to (2), an Authorised Firm must not carry on a Financial Service with or for a Person unless:
          (a) there is a Client Agreement containing the key information specified in App2 which is either entered into:
          (i) between the Authorised Firm and that Person; or
          (ii) in accordance with the requirements in Rule 3.3.4; and
          (b) before entering into the Client Agreement with the Person, the Authorised Firm has provided to that Person the key information referred to in (a) in good time to enable him to make an informed decision relating to the relevant Financial Service.
          (2) An Authorised Firm may provide a Financial Service to a Client without having to comply with the requirement in (1);
          (a) subject to (3), where it is, on reasonable grounds, impracticable to comply; or
          (b) where the Client has expressly agreed to dispense with the requirement in regard to a personal investment vehicle.
          (3) When (2)(a) applies, an Authorised Firm providing the Financial Service must:
          (a) first explain to the Person why it is impracticable to comply; and
          (b) enter into a Client Agreement as soon as practicable thereafter.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]

          • COB 3.3.2 Guidance

            1. App 2 sets out the core information that must be included in every Client Agreement and additional disclosure for certain types of activities to which this chapter applies. The information content for Client Agreements with Retail Clients is more detailed than for Professional Clients.
            2. For the purposes of COB Rule 3.3.2(1)(b), an Authorised Firm may either provide a Person with a copy of the proposed Client Agreement, or give that information in a separate form. If there are any changes to the terms and conditions of the proposed agreement, the Authorised Firm should ensure that the Client Agreement to be signed with the Person accurately incorporates those changes.
            3. For the purposes of COB Rule 3.3.2(2)(a), an Authorised Firm may consider it is reasonably impracticable to provide the key information to a Person if that Person requests the Authorised Firm to execute a Transaction on a time critical basis. Where an Authorised Firm has given the explanation referred to in COB Rule 3.3.2(3)(a) verbally, it should maintain records to demonstrate to the DFSA that it has provided that information to the Client.
            Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Changes to the Client Agreement

        • COB 3.3.3

          If the Client Agreement provided to a Retail Client allows an Authorised Firm to amend the Client Agreement without the Client's prior written consent, the Authorised Firm must give at least 14 days notice to the Client before providing a Financial Service to that Client on any amended terms, unless it is impracticable to do so.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Reliance on a Client Agreement made by another entity

        • COB 3.3.4

          (1) An Authorised Firm may, for the purposes of Rule 3.3.2(1)(a)(ii), rely on a Client Agreement executed in accordance with the requirements in either (2) or (3).
          (2) For the purposes of (1), an Authorised Firm which is a Branch may rely on a Client Agreement, executed by its head office or any other branch of the same legal entity, if:
          (a) the Client Agreement adequately and clearly applies to the Financial Services provided by the Branch; and
          (b) the Authorised Firm ensures that the Client Agreement is available to the DFSA on request.
          (3) For the purposes of (1), an Authorised Firm may rely on a Client Agreement, executed by a member of its Group if:
          (a) it is providing a Financial Service pursuant to Rule 2.4.5;
          (b) the Client Agreement clearly sets out:
          (i) the Financial Service provided by the Authorised Firm and;
          (ii) that the Client's rights in respect of (i) are enforceable against the Authorised Firm; and
          (c) the Authorised Firm ensures that the Client Agreement is available to the DFSA on request.
          (4) An Authorised Firm must notify the DFSA immediately if, for any reason, it is no longer able to provide unrestricted access to a Client Agreement as required under (2) or (3).
          [Added] DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]

    • COB 3.4 COB 3.4 Suitability

      • Application

        • COB 3.4.1

          The Rules in this section do not apply where the Authorised Firm:

          (a) carries on a Financial Service with or for a Market Counterparty;
          (b) undertakes an Execution-Only Transaction;
          (c) undertakes the activities of Accepting Deposits or Providing Credit;
          (d) carries on an activity of the kind described in GEN Rule 2.26.1 that constitutes marketing;
          (e) carries on the activity of operating an MTF;
          (f) carries on the activity of Operating an Employee Money Purchase Scheme, or.
          (g) carries on the activity of Acting as the Administrator of an Employee Money Purchase Scheme.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER17/01-10]
          [Amended] DFSA RM123/2013 (Made 13th June 2013). [VER22/07-13]
          [Amended] DFSA RMI259/2019 (Made 1st January 2020). [VER34/01-20]
          [Amended] DFSA RMI261/2019 (Made 18th December 2019). [VER35/01-20]

      • Suitability Assessment

        • COB 3.4.2 COB 3.4.2

          (1) Subject to (2), an Authorised Firm must not recommend to a Client a financial product or financial service, or execute a Transaction on a discretionary basis for a Client, unless the Authorised Firm has a reasonable basis for considering the recommendation or Transaction to be suitable for that particular Client. For this purpose, the Authorised Firm must:
          (a) undertake an appropriate assessment of the particular Client's needs and objectives, and, financial situation, and also, to the extent relevant, risk tolerance, knowledge, experience and understanding of the risks involved; and
          (b) take into account any other relevant requirements and circumstances of the Client of which the Authorised Firm is, or ought reasonably to be aware.
          (2) An Authorised Firm may, subject to (3) and (4), limit the extent to which it will consider suitability when making a recommendation to, or undertaking a Transaction on a discretionary basis for or on behalf of, a Professional Client if, prior to carrying on that activity, the Authorised Firm:
          (a) has given a written warning to the Professional Client in the form of a notice clearly stating that the Authorised Firm will consider suitability only to the extent specified in the notice; and
          (b) the Professional Client has given his express consent, after a proper opportunity to consider the warning, by signing that notice.
          (3) Where an Authorised Firm manages a Discretionary Portfolio Management Account for a Professional Client, it must ensure that the account remains suitable for the Professional Client, having regard to the matters specified in (1) (a) and (b).
          (4) If an Authorised Firm has, before the Commencement Date, given a written warning to a Professional Client in the form of a notice stating that it will not consider suitability, the firm must, no later than 6 months after the Commencement Date, either:
          (a) issue a new warning that meets the requirements in (2); or
          (b) carry out a full suitability assessment in accordance with (1).
          (5) In (4), Commencement Date means the day on which Rule-Making Instrument No. 259 of 2019 comes into force.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Added] DFSA RMI259/2019 (Made 1st January 2020). [VER34/01-20]

          • COB 3.4.2 Guidance

            Information a firm needs to have for a suitability assessment
            1. When carrying out a suitability assessment under Rule 3.4.2 (1), an Authorised Firm should have, or obtain, certain minimum information about the Client. For example, the information about the Client’s:
            a. needs and objectives should include, where relevant, information about the length of time the Client wishes to hold the financial product. The age of a Client that is an individual may also be relevant;
            b. financial situation should include, where relevant, the assets, liabilities (including tax), income and expenses, and general capacity to withstand losses arising from investing in financial products; and
            c. knowledge and experience should include, where relevant, the nature, volume and frequency of previous investments made by the Client, and the Client’s level of familiarity with relevant financial products and financial services. The Client’s occupation or profession, former professional experience, and level of financial education may also be relevant.
            Overall suitability for the Client’s portfolio
            2. When recommending a financial product to a Client, or executing a discretionary transaction for a Client, an Authorised Firm should consider the overall effect the recommendation or discretionary transaction would have on the Client’s investment portfolio. For example, for a Client with a low or medium risk profile, a proportion of high-risk financial products in the Client’s portfolio may be suitable, provided this is consistent with the risk-return profile of the portfolio, and the firm is satisfied that any financial products that are recommended to the Client, or invested in, on behalf of the Client, are likely to meet the Client’s investment objectives and financial circumstances.
            Written warnings about limited suitability assessments
            3. Under Rule 3.4.2(2), an Authorised Firm may limit the extent to which it will consider suitability when making a recommendation to, or undertaking a discretionary transaction for or on behalf of, a Professional Client. However, the DFSA does not consider that this Rule permits a firm to limit its consideration of suitability to such a degree that under Rule 3.4.2(1) there is no meaningful basis for the recommendation or transaction.
            4. The DFSA expects a written warning given to a Professional Client under Rule 3.4.2(2) to:
            a. be in a stand-alone document (for example, not be included in the Client Agreement or other communication issued to the Client);
            b. be given in good time before providing the financial service; or
            c. clearly state how the suitability assessment will be limited, for example what the firm would consider, or would not consider, as part of the limited assessment, such as any specified investment objectives, needs or circumstances of the Client, or a limited range of financial products from which the firm would be choosing;
            d. specify any risks associated with undertaking a suitability assessment that is limited in scope; and
            e. provide for a clear acknowledgement by the Client that they have received and understood the warning and consent to the limited suitability assessment that will be undertaken by the firm, as set out in that warning.
            5. A firm should consider the need to provide a fresh warning to a Professional Client in some circumstances. For example, where the firm becomes aware of significant changes to::
            a. the financial needs or circumstances of the Client; or
            b. the types of financial products or financial services covered by an existing warning.
            Suitability assessment when Providing Trust Services
            6. An Authorised Firm Providing Trust Services does not have to undertake an assessment of the factors such as risk tolerance, knowledge and experience of a Client when assessing the suitability of the service to a particular Client. This is because those considerations are not relevant to the activity of Providing Trust Services.
            Suitability assessment when recommending a Credit Facility
            7. An Authorised Firm that recommends to a Client a particular Credit Facility as suitable for that Client, needs to consider whether the facility is suitable for the Client in terms of its affordability by the Client. An Authorised Firm acting as a credit broker for a Client would need to consider not only the affordability of the facility for the Client, but also whether the product is suitable compared to other credit products available in the market. However, a provider of a Credit Facility is only required to assess the suitability for a particular Client if it makes a recommendation to that Client.
            8. When an Authorised Firm recommends a Credit Facility to a Retail Client it should consider, in particular, the impact of the rates and other applicable conditions on the Retail Client. For example, the DFSA does not consider that a firm could have any reasonable basis to recommend to a Retail Client a pay-day facility, salary advance facility or any similar arrangement that has exorbitant rates.
            Suitability assessment when Operating an Employee Money Purchase Scheme or Acting as the Administrator of an Employee Money Purchase Scheme
            9. The Financial Services of Operating an Employee Money Purchase Scheme or Acting as the Administrator of such a Scheme do not permit the Operator or Administrator to advise Members of the Scheme, particularly on the suitability of investments offered on the Investment Platform. If an Operator or Administrator wishes to give such advice, it must obtain an authorisation for Advising on Financial Products.
            Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
            [Added] DFSA RMI259/2019 (Made 18th December 2019). [VER/34/01-20]
            [Added] DFSA RMI261/2019 (Made 18th December 2019). [VER35/01-20]
            [Amended] DFSA RMI267/2020 (Made 26th February 2020). [VER36/04-20]

        • COB 3.4.3

          An Authorised Firm must take reasonable steps to ensure the information it holds about a Client is accurate, complete and up to date.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 3.5 COB 3.5 Conflicts of Interest

      • Fair Treatment

        • COB 3.5.1

          (1) An Authorised Firm must take reasonable steps to ensure that conflicts and potential conflicts of interest between itself and its Clients and between one Client and another are identified and then prevented or managed in such a way that the interests of a Client are not adversely affected and to ensure that all its Clients are fairly treated and not prejudiced by any such conflicts of interest.
          (2) Where an Authorised Firm is aware of a conflict or potential conflict of interest, it must prevent or manage that conflict of interest by using one or more of the following arrangements as appropriate:
          (a) establishing and maintaining effective Chinese Walls to restrict the communication of the relevant information;
          (b) disclosing the conflict of interest to the Client in writing either generally or in relation to a specific Transaction; or
          (c) relying on a written policy of independence, which requires an Employee to disregard any conflict of interest when advising a Client or exercising a discretion.
          (3) If an Authorised Firm is unable to prevent or manage a conflict or potential conflict of interest as provided in (2), it must decline to act for that Client.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Attribution of Knowledge

        • COB 3.5.2

          When a COB Rule applies to an Authorised Firm that acts with knowledge, the Authorised Firm will not be taken to act with knowledge for the purposes of that Rule as long as none of the relevant individuals involved for on behalf of the Authorised Firm acts with that knowledge as a result of a Chinese Wall arrangement established under COB Rule 3.5.1(2)(a).

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Inducements

        • COB 3.5.3 COB 3.5.3

          (1) An Authorised Firm must have systems and controls including policies and procedures to ensure that neither it, nor an Employee or Associate of it, offers, gives, solicits or accepts inducements such as commissions or other direct or indirect benefits where such inducements are reasonably likely to conflict with any duty that it owes to its Clients.
          (2) Subject to (3), an Authorised Firm must, before recommending a financial product as defined in GEN Rule 2.11.1(4) to, or Executing a Transaction for, a Retail Client, disclose to that Client any commission or other direct or indirect benefit which it, or any Associate or Employee of it, has received or may or will receive, in connection with or as a result of the firm making the recommendation or executing the Transaction.
          (3) An Authorised Firm need not disclose to a Retail Client under (2) any details about inducements where it:
          (a) believes on reasonable grounds that the Retail Client is al aware of the relevant inducements;
          (b) is undertaking an Execution-Only Transaction for that Retail Client; or
          (c) is executing a Transaction pursuant to the terms of a Discretionary Portfolio Management Agreement for that Retail Client.
          (4) An Authorised Firm may provide the information required under (2) in summary form, provided it informs the Client that more detailed information will be provided to the Client upon request and complies with such a request.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DSFA RM185/2016 (Made 7th December 2016). [VER28/02-17]

          • COB 3.5.3 Guidance

            In relation to COB Rule 3.5.3 (1), in circumstances where an Authorised Firm believes on reasonable grounds that the Client's interests are better served by a Person to whom the referral is to be made, any commission or other benefit which the firm or any of its Employees or Associates receives in respect of such a referral would not be a prohibited inducement under that Rule.

            Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 3.5.4 COB 3.5.4

          An Authorised Firm may only accept goods and services under a Soft Dollar Agreement if the goods and services are reasonably expected to:

          (a) assist in the provision of Investment Business services to the Authorised Firm's Clients by means of:
          (i) specific advice on dealing in, or on the value of, any Investment;
          (ii) research or analysis relevant to (i) or about Investments generally; or
          (iii) use of computer or other information facilities to the extent that they are associated with specialist computer software or research services, or dedicated telephone lines;
          (b) provide custody services relating to Investments belonging to, or managed for, Clients;
          (c) provide services relating to portfolio valuation or performance measurement services; or
          (d) provide market price services.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

          • COB 3.5.4 Guidance

            An Authorised Firm should undertake a thorough assessment of the nature of the goods and services and the terms upon which they are to be provided under a Soft Dollar Agreement to ensure that the receipt of such goods and services provide commensurate value. This is particularly the case if any costs of such goods and services are to be passed through to Clients. Where the Client bears the cost of the goods and services, the disclosure obligation relating to costs and charges under COB Rule 3.3.2 (see App 2) will apply to such costs.

            Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 3.5.5

          An Authorised Firm must not Deal in Investments as Agent for a Client, either directly or indirectly, through any broker under a Soft Dollar Agreement, unless:

          (a) the agreement is a written agreement for the supply of goods or services described in COB Rule 3.5.4, which do not take the form of, or include, cash or any other direct financial benefit;
          (b) Transaction execution by the broker is consistent with any best execution obligations owed to the Client;
          (c) the Authorised Firm has taken reasonable steps to ensure that the services provided by the broker are competitive, with no comparative price disadvantage, and take into account the interests of the Client;
          (d) for Transactions in which the broker acts as principal, the Authorised Firm has taken reasonable steps to ensure that Commission paid under the agreement will be sufficient to cover the value of the goods or services to be received and the costs of execution; and
          (e) the Authorised Firm makes adequate disclosure in accordance with Rules COB 3.5.6 and COB 3.5.7.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 3.5.6

          Before an Authorised Firm enters into a Transaction for or on behalf of a Retail Client or Professional Client, either directly or indirectly, with or through the agency of another Person, in relation to which there is a Soft Dollar Agreement which the Authorised Firm has, or knows that another member of its Group has, with that other Person, it must disclose to its Client:

          (a) the existence of a Soft Dollar Agreement; and
          (b) the Authorised Firm's or its Group's policy relating to Soft Dollar Agreements.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 3.5.7

          (1) If an Authorised Firm or member of its Group has a Soft Dollar Agreement under which either the Authorised Firm or member of its Group Deals for a Client, the Authorised Firm must provide that Client with the following information:
          (a) the percentage paid under Soft Dollar Agreements of the total Commission paid by or at the direction of:
          (i) the Authorised Firm; and
          (ii) any other member of the Authorised Firm's Group which is a party to those agreements;
          (b) the value, on a cost price basis, of the goods and services received by the Authorised Firm under Soft Dollar Agreements, expressed as a percentage of the total Commission paid by or at the direction of:
          (i) the Authorised Firm; or
          (ii) other members of the Authorised Firm's Group;
          (c) a summary of the nature of the goods and services received by the Authorised Firm under the Soft Dollar Agreements; and
          (d) the total Commission paid from the portfolio of that Client.
          (2) The information in (1) must be provided to that Client at least once a year, covering the period since the Authorised Firm last reported to that Client.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 3.6 COB 3.6 Record Keeping

      • COB 3.6.1

        An Authorised Firm must, for a minimum of six years, maintain sufficient records in relation to each activity and function of the Authorised Firm. These must include, where applicable, the following:

        (a) any marketing material issued by, or on behalf of, the Authorised Firm;
        (b) any financial products or Financial Services provided to a Client and each advice or recommendation made to a Client,
        (c) a record of each Client Agreement including any subsequent amendments to it as agreed with the Client;
        (d) records relating to the suitability assessment undertaken by the Authorised Firm to demonstrate compliance with COB Rule 3.4.2;
        (e) records to demonstrate compliance with the requirements relating to inducements under COB section 3.5, including any disclosure made to Clients under that section and if any goods and services are received by the Authorised Firm under a Soft Dollar Agreement, the details relating to those agreements; and
        (f) any other disclosures made to Clients.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 3.6.2

        For the purposes of COB Rule 3.6.1, the six year period commences:

        (a) in the case of the requirement in COB Rule 3.6.1(a), from the date on which the marketing material was last provided to a Person;
        (b) in the case of the requirement in COB Rule 3.6.1(b) to (d), from the date the Client ceases to be a Client of the Authorised Firm; and
        (c) in the case of the requirement in COB Rule 3.6.1(e), from the date on which the relevant inducements were last received.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]