Entire Section

  • COB 2.6 COB 2.6 Transitional Rules

    • COB 2.6.1

      An Authorised Firm may continue to treat a Person as a Retail Client, Professional Client, or Market Counterparty, as the case may be, without having to re-classify the Person under section 2.3:

      (a) where the Authorised Firm was treating that Person as such a Client (including under a waiver or modification in force) immediately prior to 1 April 2015; and
      (b) with regard to the Financial Services carried on with or for that Client prior to that date.
      Derived from DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]

    • COB 2.6.2 COB 2.6.2

      Without limiting the generality of Rule 2.6.1, and for the avoidance of doubt, any client classification adopted, Transaction carried on with or for a Client, or Client Agreement entered into with a Client for the purposes of section 3.3, prior to 1 April 2015, remains in force on and after that date.

      Derived from DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]

      • COB 2.6.2 Guidance

        1. The introduction of the new client classification regime does not trigger the need to re-classify existing Clients. However, with regard to an existing Client who has been grandfathered under Rule 2.6.1, the need for a re-classification may subsequently arise in a number of circumstances such as those set out in paragraphs 2, 3 and 4.
        2. Where a Professional Client grandfathered under Rule 2.6.1 subsequently requests to opt-in as a Retail Client under Rule 2.4.1(3), the Authorised Firm will need to re-classify that Client in accordance with the requirements in that Rule.
        3. Where a grandfathered Client wishes to obtain a new Financial Service after the new regime came into force, an Authorised Firm will not be able to rely on the existing client classification relating to that Client in respect of the new Financial Service. This is because Rule 2.6.1 only applies in respect of the Financial Services carried on with or for a Client before the new regime came into force. Therefore, the firm will need to make a new classification relating to such a Client in respect of the new Financial Service and do so under the new client classification regime.
        4. If an Authorised Firm becomes aware that a grandfathered professional client no longer fulfils the requirements to remain classified as a Professional Client, it will need to comply with the requirements in Rule 2.3.3(2).
        Derived from DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]

    • COB 2.6.3

      (1) For the purposes of classifying a Person as an 'assessed' Professional Client under either Rule 2.3.7 or Rule 2.3.8, the reference to $1 million in each of Rules 2.3.7(1)(a) and 2.3.8(1)(a) is to be read as a reference to $500,000 on and before 31 March 2016.
      (2) An Authorised Firm may continue to treat a Person as an 'assessed' Professional Client in reliance on the lower asset threshold specified in (1) on and after 1 April 2016 provided:
      (a) it is in respect of the Financial Services carried on with or for the Client prior to that date; and
      (b) the firm continues to ensure that all the other applicable requirements in this chapter are met in respect of that Client.
      Derived from DFSA RM149/2015 (Made 11th February 2015) [VER24/04-15]