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W 019/07 COB — Merrill Lynch Bank (Suisse) S.A

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MODIFICATION NOTICE

To Merrill Lynch Bank (Suisse) S.A
Address The Gate Building 5th Floor
DFSA Firm Reference No. F000010
Notice No. W019/2007

THE DFSA HEREBY GIVES NOTICE THAT:

The Rules specified in the table herein do not apply to the above mentioned Person in the form appearing in the Rulebook but instead apply to that Person in the modified form prescribed in that table below. This notice replaces notice W206/2006 which is hereby withdrawn.

This notice is issued by the DFSA under Article 25 of the Regulatory Law 2004.

Effective date: This notice comes into effect on 28th January 2007 and expires on 27rd January 2008 or the date on which any Rule specified herein is amended, which ever is the earlier.

RULES MODIFIED

The Rules listed in the left hand column of the table below are modified as shown in the right hand column of the table. In this table, underlining indicates new text and striking through indicates deleted text.

The version of Rules to which this notice relates is [COB/VER7/08-06].

Rule Modified Text
COB 3.2.2
(1) A Client is a Person who the Authorised Firm has determined, prior to the establishment of a relationship is:
(a) an individual who :
(i) has at least $1 million in liquid assets and has provided the Authorised Firm with written confirmation of this fact or any entity within the Authorised Firm’s Group has provided such confirmation;
(ii) appears to the Authorised Firm after analysis, to have sufficient financial experience and understanding to participate in financial markets; and
(iii) was a customer of the Authorised Firm’s Group immediately prior to the effective date of this notice, who fulfils the criteria in 1(a)(i) and (ii) or (2) or (4) and has been notified in writing (one way notification) by the Authorised Firm, that it will be providing specific Investment Business services to him and he has not objected to being treated as a Client prior to his account being transferred to the Authorised Firm; or
(iv) has consented in writing to being treated as a Client;
(b) ……………and so on upto and including (l)…
(2) Where individuals have linked or joint bank accounts, a Client is a Close Relative of the primary account holder, where the primary account holder is a Client under (1), but only in circumstances where either:
(a) that Close Relative fulfils the requirement in (1) (a) (ii); or
(b) in accordance with the provisions of a legal document, the legal effect of which is, that all Financial Services transactions between the Authorised Firm and the Close Relative are agreed by the primary account holder.
(3) For the purposes of (2) the defined term Close Relative includes grandchildren of the primary account holder.
(4) A personal investment vehicle or the trustee of such a vehicle is a Client if it is established and operated for the sole purpose of providing a vehicle to facilitate efficient management of a Client's investment portfolio including, if applicable, the portfolio’s of any Close Relatives of that Client.
(5) For the purposes of (4), the term Close Relative includes grandchildren of the Client.
(6) For the purpose of (4) a personal investment vehicle must be a:
(a) Body Corporate;
(b) Partnership;
(c) trust, or
(d) foundation; and
have net assets or share capital of at least $1 million.
(7) A personal investment vehicle that is a Body Corporate or trust must be valued in accordance with (1) (c) or (d) as applicable and if a foundation, must be valued in the same manner as a trust.
(8) Any Person who does not meet the criteria in (1), (2) or (4) is a Retail Customer.
COB 3.2.6
(1) An Authorised Firm must keep records of the verification process undertaken for each Client including any documents which evidence the Client’s status
(2) If the Client in (1) is an individual the records must include the analysis undertaken, the reasons for the Authorised Firm concluding that the individual merits classification as a Client, and the Client’s written consent to be treated as a Client, and where an individual was a customer of the firm immediately prior to the effective date of this notice, a copy of the one way written notification, advising the customer that the customer will be treated as a Client for the purposes of the DFSA Rules.
(3) These records must be kept for at least six years from the date on which the business relationship has ended. If the date on which the business relationship ended remains unclear it may be taken to have ended on the date of the completion of the last transaction.
(4) If an individual is classified as a Client by virtue of Rule 3.2.2(2) or (4) then the records must include documents which evidence that individual’s status as a Close Relative and, where relevant, the legal documentations referred to in Rule 3.2.2(2)(b).
COB 8.1.1
(1) Subject to Rule 8.1.2, an Authorised Firm must before conducting Investment Business with a Client provide him with a client agreement containing the matters referred to in Rule 8.1.4 or if impractical to do so, provide it within a reasonable period.
(2) The Authorised Firm must, for Clients who were customers of the Authorised Firm’s Group immediately prior to the effective date of this notice, advise the Clients by way of a one way notification, of the new regulatory status of the Authorised Firm and that the customer will be treated as a Client for the purposes of the DFSA Rules.

CONDITIONS

None

INTERPRETATION

The provisions in this notice are to be construed in accordance with GEN section 6.2 as if these provisions are provisions of the Rulebook.

Defined terms are identified in this notice by the capitalisation of the initial letter of a word or of each word in a phrase and are defined in the Glossary (GLO). Unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.

This notice was issued by:

Name : Michael Zamorski
Position : Managing Director
Date : 28th January 2007.