EXPLANATION OF EFFECT OF BEING TREATED AS AN ACCREDITED INVESTOR UNDER THE
CONSENT PROVISIONS
The following sets out the effect under the consent provisions of you being treated by us as anaccredited investor. Where we deal with you as an accredited investor, we would be exempt
from complying with certain requirements under the Financial Advisers Act 20011 of Singapore(the “FAA”) and certain regulations, notices and guidelines issued thereunder, as well as certain
requirements under the Securities and Futures Act 20012 of Singapore (the “SFA”) and certain
regulations and notices issued thereunder.
Please note that the regulatory requirements that we are exempted from when dealing with you
as an accredited investor may be amended and updated from time to time due to regulatorychanges or otherwise.
Under the SFA and the regulations and notices issued thereunder:
1. Compensation from fidelity fund under Section 186(1) of the SFA. The fidelity fund isestablished by an approved exchange (such as and including Singapore Exchange Securities
Trading Limited, Singapore Exchange Derivatives Trading Limited, ICE Futures Singapore Pte.
Ltd. and Asia Pacific Exchange Pte. Ltd.). Section 186(1) of the SFA provides for a fidelity fundto be held and applied for the purposes of compensating persons who suffer pecuniary loss
because of certain defaults. Compensation may be made where there is a defalcation committed
by a member of the approved exchange or its agent in the course of, or in connection with, adealing in capital markets products done on the approved exchange or through a trading linkageof the approved exchange with an overseas exchange, where the defalcation is committed inrelation to any money or other property which (after the establishment of the fidelity fund) was
entrusted to or received by, inter alia, that member or by any of its agents for or on behalf of any
other person or as trustee.
When we deal with you as an accredited investor, you would not be entitled to becompensated from the fidelity fund, even if you have suffered pecuniary loss in the mannercontemplated under Section 186(1) of the SFA. You are therefore not protected by therequirements of Section 186(1) of the SFA.
2.

1
2

Prospectus Exemptions under Sections 275 and 305 of the SFA. Under Part XIII of the SFA,
all offers of securities and securities-based derivatives contracts, and units of collective
investment schemes are required to be made in or accompanied by a prospectus in respect of
the offer that is lodged and registered with the MAS and which complies with the prescribed
content requirements, unless exempted. The SFA further provides for criminal liability for false
and misleading statements contained in the prospectus, omissions to state any information
required to be included in the prospectus or omissions to state new circumstances that have risen
since the prospectus was lodged with the MAS which would have been required to be included in
the prospectus if it had arisen before the prospectus was lodged with the MAS. In addition, certain
persons, including the person making the offer, the issuer, the issue manager and the underwriter

Previously referred to as Financial Advisers Act (Chapter 110)Previously referred to as the Securities and Futures Act (Chapter 289)

A CITIC Securities Company

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624
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clsa.com(the “Persons”) may be liable to compensate any person who suffers loss or damage as a resultof the false or misleading statement in or omission from the prospectus, even if such persons
were not involved in the making of the false or misleading statement or the omission.
Sections 275 and 305 of the SFA are exemptions from the prospectus registration requirement
under the SFA, and exempt the offeror from registering a prospectus when the offer of securities
and securities-based derivatives contracts, and units of collective investment schemes is made to
relevant persons. Relevant persons include accredited investors. In addition, secondary sales
made to institutional investors and relevant persons, which include accredited investors, remain
exempt from the prospectus registration requirement provided that certain requirements are met.
Subsequent Sales: Subsequent sales of securities, securities-based derivatives contracts andcollective investment schemes are subject to restrictions under Section 276(1) and 276(2) or, as
the case may be, Sections 305A(1)(b) such that subsequent sales to relevant persons (including
accredited investors) will continue to be exempt from prospectus requirements.
Where securities, securities-based derivatives contracts and collective investment schemes are
subscribed or purchased under Section 275 or 305 of the SFA by a relevant person which is:(a)a corporation (which is not an accredited investor) the sole business of which is to holdinvestments and the entire share capital of which is owned by one or more individuals,
each of whom is an accredited investor (the “Corporation”); or(b)a trust (where the trustee is not an accredited investor) whose sole purpose is to holdinvestments and each beneficiary of the trust is an individual who is an accredited investor(the “Trust”),

inter alia, securities of that corporation or the beneficiaries’ rights and interest (howsoever
described) in that trust shall not be transferred within six months after that corporation or that trust
has acquired the securities, securities-based derivatives contracts and collective investment
schemes pursuant to an offer made under Section 275 or 305 of the SFA except, inter alia, to an
institutional investor or to a relevant person.
If you opt to be treated as an accredited investor, the above restrictions will not apply and you will
not be prohibited from being a transferee of the securities of the Corporation or interests in the
Trust in the circumstances specified.
When we deal with you as an accredited investor, the issuer and/or offeror is exempt fromthe prospectus requirements under Part XIII of the SFA pursuant to the exemptions under
Sections 275 and 305 of the SFA. As a result of this, the issuer and/or offeror is not under
any statutory obligation to ensure that all offers of the relevant products to you are madein or accompanied by a prospectus that is lodged and registered with the MAS and which
complies with the prescribed content requirements. Consequently, the issuer and/or
offeror is not subject to the statutory prospectus liability under the SFA and you would not
be able to seek compensation from the Persons under the civil liability regime forprospectuses even if you suffer loss or damage as a result of any false or misleading

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

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statement in or omissions in the offering document. Subsequent sales of securities,
securities-based derivative contracts and collective investment schemes first sold underinter alia Section 275 and 305 can also be made to you, as well as transfers of securities ofCorporations and interests in Trusts. You are therefore not protected by the prospectus
registration requirements of the SFA.
3. Restrictions on Advertisements under Sections 251 and 300 of the SFA. Sections 251 and300 of the SFA prohibit any advertisement or publication referring to an offer or intended offer of
securities and securities-based derivatives contracts, and units of collective investment schemes
from being made, except in certain circumstances. In this regard, where a preliminary document
has been lodged with the MAS, certain communications may be made. These include thedissemination of, and presentation of oral or written material on matters contained in, thepreliminary document which has been lodged with the MAS to institutional investors and relevant
persons under Sections 251(3), 251(4)(a), 300(2A) and 300(2B)(a) of the SFA. Relevant persons
include accredited investors.
When we deal with you as an accredited investor, you may receive communications
relating to a preliminary document which has been lodged with the MAS. You are therefore
not protected by the requirements of Sections 251 and 300 of the SFA.
4. Part III of the Securities and Futures (Licensing and Conduct of Business) Regulations(“SFR”).
Part III of the SFR stipulates the requirements imposed on us in relation to the treatment ofcustomers’ moneys and assets. While we remain under the statutory obligation to deposit all
moneys and assets received on your account in a trust account or custody account maintained inaccordance with Regulations 17 and 27 of the SFR (respectively) or any other account into which
you direct the moneys or assets be deposited, as an accredited investor, the enhanced safeguards
in relation to the moneys that we receive from or on your account (in particular in relation to overthe-counter (“OTC”) derivatives transactions) will not apply.
We may also deposit moneys received on your account, including moneys received in respect of
OTC derivatives contracts, with an approved clearing house, a recognised clearing house, amember of an organised market or a member of a clearing facility for the purposes of facilitatingtransactions on those clearing facilities or organised markets (as the case may be) on your behalf
or for any other purposes as the rules that such clearing facilities or organised markets may specify(as the case may be).
We are also exempt from the following statutory obligations: (i) the disclosure requirements
pertaining to the manner in which your moneys and assets are held (whether locally or in a foreign
jurisdiction), as specified under Regulations 18A and 27A of the SFR (respectively); (ii) the
prohibition against transferring title in your moneys or assets to us or any other person except incertain prescribed circumstances relating to the borrowing or lending of your specified products,
and using your moneys or assets to meet our own obligations under Regulation 20A and 34A, and
35 of the SFR (respectively); (iii) the obligation to inform you that we may use your assets for asum not exceeding the amount owed by you to us, disclose the risks of such use to you and obtain

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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your consent before using your assets, including mortgaging, charging, pledging or hypothecating
your assets under Regulation 34 of the SFR.
We have summarised the requirements below.
Holder of capital markets
services licence (“CMSL”)
that is a member of an
approved clearing house orrecognised clearing house
Money received for OTC
derivatives contract3

Retail customer

Accredited investor

Deposit into a trust account

Money received for capital
markets product that is notanOTCderivatives
contract4





3
4

Deposit into a trust
account maintained inaccordance
withRegulation 17 of the SFR(requiresthetrust
account to be maintainedwith a certain specified
institutionwhichisassessed as suitable); or
Deposit into accountdirectedbyretailcustomer to which retailcustomer has legal andbeneficial
title
and
maintained with licensed
banks, merchant banks orfinance companies orbanks established andregulatedasbanks
outside Singapore

Deposit into a trust
account; orDeposit into accountdirected by accredited
investor
Deposit into a trust
account maintained inaccordance
withRegulation 17 of the SFR(requiresthetrust
account to be maintainedwith a certain specified
institutionwhichisassessed as suitable); or
Deposit into accountdirected by accredited
investor

Regulation 16(1)(b)Regulation 16(1)(b)80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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Moneys must not be 
commingled or depositedin the same trust account5

CMSL holder that is not amember of an approved
clearing
house
orrecognised clearing house
Money received on accountof customer6

Exceptionformoneyreceived in respect ofOTC
derivatives
contracts, where moneys
received on account ofretail customers can becommingled or depositedin same trust accountExceptionformoneyreceived on account ofretail customers in respectof any capital markets
products other than OTC
derivatives
contracts,
where
such
moneysreceived on account ofretail investors can becommingled or depositedin same trust account asmoney
receivedonaccount
of
non-retailcustomers



Exception for money
received on account of
non-retailcustomers,
which can be commingled
or deposited in the same
trust account as money
received on account ofretail customers in respectof any capital markets
products other than OTC
derivatives contracts

Retail customer

Accredited investor

Deposit into a trust
account maintained inaccordance
withRegulation 17 of the SFR(requiresthetrust
account to be maintainedwith a certain specified
institutionwhichisassessed as suitable); or

56

Deposit into a trust
account maintained inaccordance
withRegulation 17 of the SFR(requiresthetrust
account to be maintainedwith a certain specified
institutionwhichisassessed as suitable); or
Deposit into accountdirected by accredited
investor

Regulation 16(3)Regulation 16(1)(ba)80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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name.



7
8

Deposit into accountdirectedbyretailcustomer to which retailcustomer has legal andbeneficial
title
and
maintained with licensed
banks, merchant banks orfinance companies orbanks established andregulatedasbanks
outside Singapore

All CMSL holders
Money received in foreign
currency, subject to writtenconsent of customer7

Retail customer

Accredited investor

Deposit moneys (otherthan moneys received
from or on account ofretail customer in respectof
OTC
derivatives
contracts entered into
betweenthe
CMSL
holderandretailcustomer) into a trust
account with custodian
outside Singapore which
is licensed to conduct
banking businessDepositallmoneys(including
moneysreceived in respect ofOTC
derivatives
contracts) into a trust
account with custodian
outside Singapore which
is licensed to conduct
banking business

Disclosure requirement8



CMSL holder to makecertain disclosures (suchaswhetherthemoneys/assets will becommingled with othercustomers and the risksofcommingling,
consequences if theinstitution
which
maintainsthetrust/custodyaccount
becomes insolvent) inwriting prior to depositing
moneys/assets
intrust/custody accountNo such requirement

Regulation 17(2)Regulations 18A and 27A

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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9

Depositing moneys withinter alia approved orrecognised clearing houseor member of organised
market or clearing facility9Permitted
onlyfor
moneys received for nonOTC
derivatives
contracts for certain
purposes, e.g. facilitating
the continued holding of aposition on behalf of thecustomer, clearing or
settlement of capital
markets products on theclearing facility

Permitted
onlyfor
moneys received forcertain purposes, e.g.
facilitating the continued
holding of a position on
behalf of the customer,
clearing or settlement of
capital markets productson the clearing facility

Prohibition on transferring
title
ofmoneys/assets
received from customer to
CMSL holder or any otherperson10Prohibited
unlesstransferred in connection
with:o in the case ofmoneys, the lendingoftheretailcustomer’s specified
products; ando in the case of assets,
the borrowing or
lending of specified
products,
inaccordance
withRegulation 45 of the SFR

No such requirement

Withdrawals from trust
account/custody account tomake payment/transfer themoneys/assets to any otherperson or account inaccordance with the written
direction of the customer11



Not permitted where thewithdrawal is from a retailcustomer’s trust accountfor the purpose of making
a payment, and not
permitted to transfer retailcustomer’s assets, tomeet any obligation of the
CMSL holder in relation to
any transaction enteredinto by the CMSL holder
for the benefit of theholder

No such prohibition

Regulation 19
Regulations 20A and 34A
Regulations 21(2) and 35(2)101180 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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Customer Assets12Mortgage of customer’s
assets – CMSL holder may
mortgage, charge, pledge
or hypothecate customer’s
assets for a sum notexceeding the amount owed
by the customer to theholder13

Deposit into a custodyaccount maintained inaccordance
withRegulation 27 of the SFR(requires the custodyaccount to be maintainedwith certain specified
institutions only); or
Deposit into accountdirectedbyretailcustomer to which retailcustomer has legal andbeneficial
title
and
maintained with, interalia, licensed banks,
merchantbanks
orfinance companies orbanks established andregulatedasbanks
outside Singapore

Prior to doing so, CMSL
holder must inform theretail customer of thisright, explain the risks
andobtainwrittenconsent of the retailcustomer

Deposit into a custodyaccount maintained inaccordance
withRegulation 27 of the SFR(requires the custodyaccount to be maintainedwith certain specified
institutions only); or
Deposit into accountdirected by accredited
investorNo
equivalentrequirement to inform,
explain risks or obtainwrittenconsentofaccredited investor

When we deal with you as an accredited investor, we are exempt from treating you as a“retail investor” in relation to certain requirements stipulated under Part III of the SFR
pertaining to the treatment of a retail customer’s moneys and assets. You are therefore notprotected by those requirements under Part III of the SFR.
5.

Regulation 47BA of the SFR. Regulation 47BA of the SFR provides that a CMSL holder must
not deal with a retail customer as an agent when dealing in capital markets products that are overthe-counter derivatives contracts and/or spot foreign exchange contracts for the purposes ofleveraged foreign exchange trading.
When we deal with you as an accredited investor, we are exempt from treating you as a“retail investor” and may therefore deal with you as an agent in relation to over-the-counter
derivatives contracts and/or spot foreign exchange contracts for the purposes ofleveraged foreign exchange trading.

12
13

Regulation 26(1)(a)Regulation 34(2)80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company

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name.

6.

Regulation 47E of the SFR. Regulation 47E(1) and (2) of the SFR provide for certain risk
disclosure requirements that a CMSL holder that deals in capital markets products and provides
fund management services respectively must comply with in relation to trading in futurescontracts, spot foreign exchange contracts for the purposes of leveraged foreign exchange
trading, and foreign exchange over-the-counter derivatives contracts for retail customers that are
not related corporations of the CMSL holder.
A CMSL holder that deals in capital markets products must not open a trading account for a retailcustomer who is not its related corporation for the purpose of entering into transactions of saleand purchase of the abovementioned capital markets products unless it has furnished thecustomer with a written risk disclosure document disclosing the material risks of the specified
capital markets products in a prescribed form (Form 13), and receives an acknowledgement
signed and dated by the customer that he has received and understood the nature and contentsof the Form 13.
A CMSL holder that provides fund management services shall not solicit or enter into anagreement with a prospective retail customer who is not its related corporation for the purpose ofmanaging or guiding the retail customer’s trading account for the purposes of futures contracts,
spot foreign exchange contracts for the purposes of leveraged foreign exchange trading, andforeign exchange over-the-counter derivatives contracts by means of a systematic programmethat recommends specific transactions unless it has delivered the prospective retail customer witha written risk disclosure document in a prescribed form (Form 14), and received an
acknowledgement signed and dated by the prospective retail customer that he has received andunderstood the nature and contents of the Form 14.
Regulation 47E also specifies that copies of Forms 13 and 14 are kept in Singapore.
When we deal with you as an accredited investor, we are not under any statutory obligation
to provide you with the risk disclosures in the manner contemplated under Regulation 47Eof the SFR. You are therefore not protected by the risk disclosure requirements under
Regulation 47E of the SFR.

7.

Section 99H(1)(c) of the SFA read with Regulations 3A(5)(c), (d), (e) and (7) of the SFR.
Section 99H(1)(c) of the SFA read with Regulations 3A(5)(c), (d) and (e) of the SFR provide that
where a principal wishes to appoint an individual as a provisional representative or temporary
representative in respect of any SFA regulated activity, the principal is required to lodge with the
MAS an undertaking to ensure that (i) the provisional representative or temporary representativeis accompanied at all times by an authorised person when meeting any client or member of the
public in the course of carrying on business in any SFA regulated activity, (ii) the provisional
representative or temporary representative sends concurrently to an authorised person allelectronic mail that he sends to any client or member of the public in the course of carrying on
business in any SFA regulated activity and (iii) the provisional representative or temporary
representative does not communicate by telephone with any client or member of the public in thecourse of carrying on business in any SFA regulated activity, other than by telephone conferencein the presence of an authorised person. An “authorised person” for these purposes refers to an

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A CITIC Securities Company

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appointed representative or a director of the principal, an officer of the principal whose primaryfunction is to ensure that the carrying on of business in the SFA regulated activity in question
complies with the applicable laws and requirements of the MAS or an officer of the principal
appointed to supervise the representative in carrying on of business in the SFA regulated activity.
When we deal with you as an accredited investor, we are not under any statutory obligation
to restrict the interactions with you that may be undertaken by our provisional
representatives or temporary representatives in the course of carrying on business in any
SFA regulated activity in the manner set out in Regulations 3A(5)(c), (d) and (e) of the SFR.
You are therefore not protected by the requirements of Section 99H(1)(c) of the SFA readwith Regulations 3A(5)(c), (d) and (e) of the SFR.
8.

Regulation 7 of the SFR. Regulation 7 of the SFR provides that a CMSL holder for dealing in
capital markets products that are specified products (other than a member of an approved
exchange (such as Singapore Exchange Securities Trading Limited) is required to lodge with the
MAS a deposit of S$100,000 for the duration of its licence, where the deposit shall be applied by
the MAS for the purpose of compensating any person (other than an accredited investor, expert
investor or institutional investor) who suffers pecuniary loss as a result of any defalcationcommitted by the CMSL holder or any of its agents in relation to any money or other property
which, in the course of or in connection with its business in dealing in capital markets productsthat are specified products was (i) entrusted to or received by the CMSL holder or agent for or on
behalf of any other person or (ii) entrusted to or received by the CMSL holder as trustee (whether
or not with any other person) of that money or property, or the agent as trustee of, or on behalf ofthe trustee of, that money or property.
When we deal with you as an accredited investor, you would not be able to claim
compensation in relation to the deposit we, as a CMSL holder for capital markets productsthat are specified products, have lodged with the MAS, even if you have suffered pecuniary
loss in the manner contemplated in Regulation 7 of the SFR. You are therefore notprotected by the requirements of Regulation 7 of the SFR.

9. Regulation 13B(4)(b)(ii) of the SFR. Regulation 13B(1)(c) of the SFR requires a CMSL holder
for fund management to ensure that assets under its management are subject to independent
custody, and to the extent not already segregated under Part III of the SFR, to be segregatedfrom its proprietary assets or the proprietary assets of its related corporations or connected
persons.
Under Regulation 13B(4)(b)(ii) of the SFR, a CMSL holder for fund management is exempt fromcomplying with the requirement under Regulation 13B(1)(c) of the SFR when the assets under its
management are interests in a closed-end fund or an arrangement constituted in the form of anentity or as a trust on or after 1 July 2013 (which meets certain requirements), where the closedend fund or arrangement is (i) to be used for private equity or venture capital investments, and (ii)interests in the closed-end fund or arrangement are offered only to accredited investors or
institutional investors or both.

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When we deal with you as an accredited investor who is an investor in such a closed-end
fund or arrangement, and provided we have disclosed this fact to you and arranged for an
auditor to audit the assets on an annual basis and furnish a report on the audit to you, weare not under any statutory obligation to subject your assets under our management to
independent custody and to segregate them from our proprietary assets and the assets ofour related corporations or connected persons. You are therefore not protected by therequirements of Regulation 13B(1)(c) of the SFR.
10. Regulation 33 of the SFR. Regulation 33(2) of the SFR provides that a CMSL holder shall notlend or arrange for a custodian to lend the specified products of the customer unless it has
explained the risks involved to the customer (Regulation 33(2)(a)) and obtained the customer’s
written consent to do so (Regulation 33(2)(b)). The requirement to explain the risks involved tothe customer does not apply where the customer is an accredited investor, expert investor or
institutional investor. However, regardless of whether the customer is a retail investor or an
accredited investor, the CMSL holder shall nevertheless enter into an agreement with thecustomer to set out the terms and conditions for such lending, or as the case may be, enter into
an agreement with the custodian setting out the terms and conditions for the lending and disclose
these terms and conditions to the customer.
When we deal with you as an accredited investor, we are not under any statutory obligation
to explain the risks involved to you prior to us lending or arranging for a custodian to lend
your specified products. You are therefore not protected by the requirements of Regulation
33(2)(a) of the SFR.
11. Regulation 40 of the SFR. Regulation 40(1) of the SFR provides that a CMSL holder is required
to furnish to each customer on a monthly basis a statement of account containing certain
particulars prescribed under Regulation 40(2) of the SFR. In addition, Regulation 40(3) of the SFR
provides that a CMSL holder is required to furnish to each customer, at the end of every quarterof a calendar year, a statement of account containing, where applicable, the assets, derivatives
contracts of the customer and spot foreign exchange contracts for the purposes of leveraged
foreign exchange trading of the customer that are outstanding and have not been liquidated andcash balances (if any) of the customer at the end of that quarter.
When we deal with you as an accredited investor and provided we have made available toyou (on a real-time basis) the prescribed particulars in the form of electronic records
stored on an electronic facility and you have consented to those particulars being madeavailable in this manner or you have requested in writing not to receive the statement ofaccount, we are not under any statutory obligation to furnish a monthly or quarterly
statement of account to you. You are therefore not protected by the requirements ofRegulations 40(1) and (3) of the SFR.
12. Regulation 45 of the SFR. Regulation 45 of the SFR provides that borrowing and lending ofspecified products by a CMSL holder (i) must be recorded in a prior written agreement between
the CMSL holder and the lender or borrower or their duly authorised agent where such agreement
includes certain prescribed details; and (ii) must be collateralised. In particular, the CMSL holder
is required to ensure that the collateral provided must, throughout the period that the specified

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A CITIC Securities Company
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products are borrowed or lent, have a value of not less than 100% of the market value of thespecified products borrowed or lent. Regulation 45 of the SFR further sets out the acceptable
forms of collateral for these purposes.
When we deal with you as an accredited investor, we are not under any statutory obligation
to provide collateral to you under Regulation 45 of the SFR when we borrow specified
products from you. Where we provide assets to you as collateral for the borrowing, theagreement shall specify whether the specified products borrowed and the assets provided
comprising specified products (if any) are marked to market and if so, the procedures forcalculating the margin. However (unlike for retail investors), the agreement does not haveto include the requirement to mark-to-market on every business day the specified productsthat are borrowed nor the minimum collateral comprising specified products nor
procedures for calculating the margins.
13. Regulation 47A(1) of the SFR. Regulation 47A(1) of the SFR provides that disclosures of certain
interests in respect of underwriting agreements have to be made. In particular, a CMSL holder
must, in certain circumstances, disclose its interests in specified products when offering to sell
specified products otherwise than in the ordinary course of trading on an approved exchange orrecognised market operator or recommending specified products, where the CMSL holder hasentered into an underwriting agreement in respect of such specified products. Copies of any
written offer, written recommendation or written statement sent by the CMSL holder must be kept
for a period of 5 years after the day of the written offer, recommendation or statement is made.
When we deal with you as an accredited investor, we are not under any statutory obligation
to provide you with disclosures of our interest in specified products in the mannercontemplated under Regulation 47A of the SFR. You are therefore not protected by therequirements under Regulation 47A of the SFR.
14. Regulation 47DA of the SFR. Regulation 47DA(1) and (2) of the SFR provide for certain generalrisk disclosure requirements that a CMSL holder dealing in specified capital markets products
must comply with. For this purpose, “specified capital markets products” means capital markets
products other than futures contracts, spot foreign exchange contracts for the purposes ofleveraged foreign exchange trading and foreign exchange over-the-counter derivatives contracts.
In particular, the CMSL holder must not open a trading account for a customer for the purpose ofentering into transactions of sale and purchase of any specified capital markets products unlessit has furnished the customer with a written risk disclosure document disclosing the material risksof the specified capital markets products, and receives an acknowledgement signed and dated by
the customer that he has received and understood the nature and contents of the risk disclosure
document. Further, the CMSL holder must not enter any transaction of sale or purchase of any
specified capital markets products unless it has informed the customer whether it is acting in thattransaction as a principal or agent and/or its intention to do so.
When we deal with you as an accredited investor, we are not under any statutory obligation
to provide you with the risk disclosures, and the capacity in which we act, in the mannercontemplated under Regulation 47DA of the SFR. You are therefore not protected by therequirements under Regulation 47DA of the SFR.

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company
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12Tel: +65 6416 7888 Fax: +65 6533 8922 Telex: RS 43286 CLSECS

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Under the FAA and the regulations, notices and guidelines issued thereunder:
15. Section 26(1)(c) of the FAA( as in force from 31 December 2021)(the “New FAA”) read with
Regulations 4A(4)(c), (d), (e) and (6) of the Financial Advisers Regulations (“FAR”). Section
26(1)(c) of the New FAA read with Regulation 4A(4)(c), (d) and (e)14 of the FAR provides that
where a principal wishes to appoint an individual as a provisional representative in respect of any
financial advisory service, a principal is required to lodge with the MAS an undertaking to ensurethat (i) the provisional representative is accompanied at all times by an authorised person when
meeting any client or member of the public in the course of providing any financial advisory
service, (ii) the provisional representative sends concurrently to an authorised person allelectronic mail that he sends to any client or member of the public in the course of providing any
financial advisory service and (iii) the provisional representative does not communicate by
telephone with any client or member of the public when providing any financial advisory service,other than by telephone conference in the presence of an authorised person. An “authorised
person” for these purposes refers to an appointed representative or a director of the principal, an
officer of the principal whose primary function is to ensure that the provision of financial advisory
service in question complies with the applicable laws and requirements of the MAS or an officerof the principal appointed to supervise the representative in providing the financial advisory
service.
When we deal with you as an “accredited investor”, we are not under any statutory
obligation to restrict the interactions with clients or members of public that may beundertaken by our provisional representatives in the course of providing any financial
advisory service in the manner set out in Regulations 4A(4)(c), (d) and (e) of the FAR. You
are therefore not protected by the requirements of Section 26(1)(c) of the New FAA readwith Regulations 4A(4)(c), (d) and (e) of the FAR.
16. Regulation 28 of the FAR. Regulation 28 of the FAR provides an exemption to a corporation,
not being a licensed financial adviser or an exempt financial adviser, which carries on thebusiness of advising others either directly or through publications or writings or by issuing or
promulgating research analyses or research reports, concerning bonds to an expert investor oran accredited investor, from having to hold a financial adviser’s licence in respect of the abovestated activity.
Regulation 28 also exempts certain exempt financial advisers from having to comply withrequirements set out in sections 35 to 38 and 4515 of the New FAA. Briefly, these requirements
are as follows. Section 35 of the New FAA imposes an obligation on a financial adviser not tomake any false or misleading statement or to employ any device, scheme or artifice to defraud.
Section 36 of the New FAA requires a financial adviser to have a reasonable basis for any

14
The FAA was revised and the New FAA entered into force on 31 December 2021, but the FAR has yet to be revised to reflect
the revised FAA provisions. Pursuant to the FAA revision (the “FAA Revision”), Section 23F(1)(c) of the FAA as in force before
31 December 2021 (the “Old FAA”) was re-arranged and is now reflected as Section 26(1)(c) in the New FAA. Any reference toSection 23F(1)(c) of the Old FAA in the FAR shall mean a reference to Section 26(1)(c) of the New FAA.
15
Pursuant to the FAA Revision, Sections 26 to 29 and 36 of the Old FAA were re-arranged and are now reflected as Sections
35-38 and Section 45 of the New FAA respectively. References to Sections 26-29 and Section 36 of the Old FAA in the FAR shallmean references to Sections 35-38 and Section 45 in the New FAA.

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

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recommendation on an investment product that is made to a client. Section 37 of the New FAA
provides that the MAS may by regulations determine the manner in which a financial adviser may
receive or deal with client’s money or property or prohibit a financial adviser from receiving or
dealing with client’s money or property in specified circumstances or in relation to specified
activities. Section 38 imposes an obligation on a financial adviser to furnish information about any
matter related to its business to the MAS if required by MAS for the discharge of its functions
under the New FAA. Section 45 of the New FAA provides for certain disclosure of interest
requirements when a financial adviser sends a circular or other written communication in which a
recommendation is made in respect of specified products (i.e. securities, specified securitiesbased derivatives contracts or units in a collective investment scheme).
When we deal with you as an accredited investor, in the course of us providing advice oranalyses on bonds, we will not be required to comply with the requirements set out insections 35 to 38 and 45 of the FAA. You are therefore not protected by theserequirements.
17. Regulation 32C of the FAR. Regulation 32C of the FAR exempts a foreign research house fromhaving to hold a financial adviser’s licence in respect of advising others by issuing or promulgating
any research analyses or research reports concerning any investment product to any investor
under an arrangement between the foreign research house and a financial adviser in Singapore,
subject to certain conditions. These include a condition that where the research analysis or
research report is issued or promulgated to a person who is not an accredited investor, expert
investor or institutional investor, the analysis or report must contain a statement to the effect thatthe financial adviser in Singapore accepts legal responsibility for the contents of the analysis orreport without any disclaimer limiting or otherwise curtailing such responsibility.
When we deal with you as an accredited investor, we need not expressly accept legal
responsibility for the contents of any research analysis or research report issued or
promulgated to you pursuant to an arrangement between us and a foreign research house.
We are also not limited by the requirement to not include a disclaimer limiting or otherwise
curtailing such legal responsibility. You are therefore not protected by these requirements
under Regulation 32C of the FAR.
18. Section 34 of the New FAA16, MAS Notice on Information to Clients and Product Information
Disclosure [Notice No. FAA-N03] and MAS Practice Note on the Disclosure of
Remuneration by Financial Advisers [Practice Note No. FAA-PN01]. Section 34 of the New
FAA imposes an obligation on a financial adviser to disclose to its clients and prospective clientsall material information relating to any designated investment product recommended by thefinancial adviser, and provides that MAS may prescribe the form and manner in which theinformation shall be disclosed. “Material information” includes the terms and conditions of thedesignated investment product and the benefits and risks that may arise from the designatedinvestment product.
16
The FAA was revised on 31 December 2021 but the MAS Notice No FAA- N03 and MAS Practice Note No. FAA –PN01 have
yet to be revised to reflect the revised FAA provisions. Pursuant to the FAA Revision, Section 25 of the Old FAA has been rearranged and is now reflected as Section 34 of the New FAA. Reference to Section 25 in MAS Notice No FAA- N03 and MAS
Practice Note No. FAA –PN01 shall mean a reference to Section 34 of the New FAA.

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company
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The MAS Notice on Information to Clients and Product Information Disclosure [Notice No. FAAN03] sets out the standards to be maintained by a financial adviser and its representatives withrespect to the information they disclose to clients. The Notice also sets out the general principles
that apply to all disclosures by a financial adviser to its clients and the specific requirements as
to the form and manner of disclosure that the financial adviser has to comply with in relation to,among others, section 34 of the New FAA. This is supplemented by the MAS Practice Note on
the Disclosure of Remuneration by Financial Advisers, which provides guidance on therequirements imposed on a financial adviser in relation to disclosing the remuneration that it
receives or will receive for making any recommendations in respect of an investment product,
or executing a purchase or sale contract relating to a designated investment product on theirclients’ behalf.
As a result of our exemption from compliance with these requirements when we deal withyou as an accredited investor, we are not under any statutory obligation to provide youwith all material information on any designated investment product in the prescribed form
and manner, e.g. the benefits and risks of the designated investment product and theillustration of past and future performance of the designated investment product. You are
therefore not protected by the disclosure requirements in section 34 of the New FAA and
MAS Notice on Information to Clients and Product Information Disclosure [Notice No. FAAN03] and the MAS Practice Note on the Disclosure of Remuneration by Financial Advisers[Practice Note No. FAA-PN01].
19. Section 36 of the New FAA17 and MAS Notice on Recommendations on Investment
Products [Notice No. FAA-N16]. Section 36 of the New FAA requires a financial adviser to havea reasonable basis for any recommendation on an investment product that is made to a client.
The financial adviser is required to give consideration to the investment objectives, financial
situation and particular needs of the client, and to conduct investigation on the investment productthat is the subject matter of the recommendation, as is reasonable in all the circumstances. Failure
to do so could, if certain conditions are satisfied, give the client a statutory cause of action to filea civil claim against the financial adviser for investment losses suffered by the client. The
conditions are that the client suffers loss or damage as a result of doing a particular act (orrefraining from doing a particular act) in reliance on the recommendation, where it is reasonable(having regard to the recommendation and all other circumstances) for the client to have done soin reliance on the recommendation.
The MAS Notice on Recommendations on Investment Products [Notice No. FAA-N16] sets out
requirements which apply to a financial adviser when it makes recommendations on investment
products to its clients. In particular, the Notice sets out: (i) the type of information the financial
adviser needs to gather from its client as part of the “know your client” process; (ii) the manner inwhich the financial adviser should conduct its analysis of the client’s financial needs and how it
should present its investment recommendations; and (iii) documentation and record keeping
requirements relating to this process. In this connection, a financial adviser is required to ensure
17
The FAA was revised on 31 December 2021 but the MAS Notice No FAA- N16 has yet to be revised to reflect the revised FAA
provisions. Pursuant to the FAA revision, Section 27 of the Old FAA has been re-arranged and is now reflected as Section 36 of
the New FAA. Reference to Section 27 in the MAS Notice No FAA- N16 shall mean a reference to Section 36 of the New FAA.

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that, before it makes any recommendation on an investment product which is neither listed norquoted on an organised market, it has been informed by the product manufacturer of theinvestment product as to whether the investment product is a “Specified Investment Product”(“SIP”). The financial adviser is required to keep proper records of such information andaccordingly convey this information to a client who intends to transact in the investment product.
SIPs include collective investment schemes and structured notes. A financial adviser is required
to conduct a review of a client’s knowledge and experience in derivatives for the purpose of
making a recommendation to the client on, or allowing the client to transact in, a SIP which isapproved in-principle for listing and quotation on, or listed for quotation or quoted on, an organised
market (“Listed SIP”), before making a recommendation on any Listed SIP (“Customer AccountReview”). Alternatively, if an investment product is an unlisted or unquoted SIP, prior to making
a recommendation on such investment product, a financial adviser is required to conduct anassessment of the client’s knowledge and experience in unlisted and unquoted SIPs (“Customer
Knowledge Assessment”). In both cases, the financial adviser must take into accountinformation on the client’s educational qualifications, investment experience and work experience,
where the client is a natural person. The financial adviser is required to comply with various
procedures (“Procedures”) depending on whether the client has the requisite knowledge andexperience in the Listed SIP or the unlisted or unquoted SIP (as the case may be), including theprovision of financial advice and/or obtaining senior management approvals.
A financial adviser is also required to furnish a client with certain prescribed risk warningstatements before making a recommendation on any overseas-listed investment product(“Overseas-Listed Investment Product”) for the first time on or after 8 October 2018, and obtainthe customer’s acknowledgement in respect of such risk warning statement.
As a result of our exemption from compliance with these requirements when we deal withyou as an accredited investor, we are not under any statutory obligation to ensure that wehave regard to the information possessed by us concerning your investment objectives,
financial situation and particular needs and have given consideration to and conductedinvestigation of the subject matter of any recommendation, and that the recommendation
is based on such consideration and investigation. We are also not statutorily required to
conduct a Customer Account Review or Customer Knowledge Assessment to determine
your investment experience and knowledge (which we would otherwise have been required
to conduct if you are a natural person), nor are we required to comply with the Proceduresor provide you with the prescribed risk warning statement for Overseas-Listed Investment
Products. Further, you will not be able to rely on section 36 of the New FAA in any claim
against us for losses that may be suffered in respect of any investment that we may haverecommended to you. You are therefore not protected by the requirements of section 36of the New FAA and MAS Notice on Recommendations on Investment Products [Notice No.
FAA-N16].
20. Section 45 of the New FAA. Section 45 of the FAA provides that when sending a circular orother written communication in which a recommendation is made in respect of specified products(i.e. securities, specified securities-based derivatives contracts or units in a collective investment
scheme), a financial adviser is required to include a concise statement, in equally legible type, ofthe nature of any interest in, or any interest in the acquisition or disposal of, those specified
products that it or any associated or connected person has at the date on which the circular or

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other communication is sent. Such circular or written communication must be retained by thefinancial adviser for five years.
As a result of our exemption from compliance with section 45 of the New FAA when wedeal with you as an accredited investor, we are not under any statutory obligation to
include such a statement of interest in specified products in any written recommendationor document that we may send to you. You are therefore not protected by the requirementsof section 45 of the New FAA if no disclosure is made of any interest that we or any
associated or connected person may have in the specified products that we may
recommend in such document.
21. Sections 47 and 48 of the New FAA18, and MAS Notice on Requirements for theRemuneration Framework for Representatives and Supervisors (“Balanced Scorecard
Framework”) and Independent Sales Audit Unit [Notice No. FAA-N20] (“BSC Notice”) and
MAS Guidelines on the Remuneration Framework for Representatives and Supervisors(“Balanced Scorecard Framework”), Reference Checks and Pre-Transaction Checks[Guideline No. FAA-G14] (“BSC Guidelines”). Section 47 of the New FAA provides that afinancial adviser must establish and maintain a remuneration framework that contains terms
consistent with the requirements prescribed by MAS for the purpose of (a) reviewing andassessing the performance of its representatives and supervisors; and (b) determining the
remuneration of its representatives and supervisors. The financial adviser must review andassess the performance, and determine and pay the remuneration, of its representatives andsupervisors in accordance with such remuneration framework.
Section 48 of the New FAA provides that a financial adviser must have an independent sales audit
unit that reports to the board of directors and chief executive officer of the financial adviser or such
unit determined by the board of directors or chief executive officer which is independent from allunits of the financial adviser which provide financial advisory services. Such independent sales
audit unit is required to audit the quality of the financial advisory services provided by the
representatives of the financial adviser and to carry out the functions and duties prescribed byMAS, in the prescribed manner.
The BSC Notice sets out the requirements in relation to the design and operation of the balanced
scorecard framework which a financial adviser is required to put in place in their remuneration
structures for their representatives and supervisors, and the independent sales audit unit. The
BSC Guidelines provide general guidance on some of the requirements of the BSC Notice, suchas the post-transaction checks and classification of infractions by the independent sales audit unit.
In addition, the BSC Guidelines set out the measures to be applied to all existing and newly
recruited representatives who have been assigned a balanced scorecard grade of “E” and allsupervisors who have been assigned a balanced scorecard grade of “Unsatisfactory” under thebalanced scorecard framework, as well as obtaining and sharing of information on the
representatives’ and supervisors’ balanced scorecard grades during reference checks. The BSC
18
The FAA was revised on 31 December 2021 but the MAS Notice No FAA- N20 and Guideline No. FAA- G14 have yet to berevised to reflect the revised FAA provisions. Pursuant to the FAA Revision, Sections 38 and 39 of the Old FAA have been rearranged and are now reflected as Sections 47 and 48 of the New FAA respectively. When reading MAS Notice No FAA- N20
and Guideline No. FAA- G14, please refer to Sections 47 and 48 of the New FAA.

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Guidelines also set out the MAS’ expectation for a financial adviser to conduct pre-transaction
checks to minimise the impact of the balanced scorecard framework on its representatives andsupervisors.
As a result of our exemption from compliance with these requirements when we deal withyou (if you are a natural person) as an accredited investor, we are not under any statutory
obligation to either (a) establish or maintain such a remuneration framework, or to review
and assess the performance, and determine and pay the remuneration, of ourrepresentatives and supervisors in accordance with such a remuneration framework, or(b) to have an independent sales audit unit to audit the quality of the financial advisory
services provided by our representatives. You are therefore not protected by therequirements of sections 47 and 48 of the New FAA, the BSC Notice and the BSC
Guidelines.
22. Regulation 18B of the FAR. Regulation 18B of the FAR provides that before selling or marketingcertain new products, a financial adviser is required to carry out a due diligence exercise toascertain whether such new product is suitable for the targeted client. The due diligence exercise
must include an assessment of several areas, including (i) an assessment of the type of targetedclient the new product is suitable for and whether the new product matches the client base of thefinancial adviser; (ii) the key risks that a targeted client who invests in the new product potentiallyfaces; and (iii) the processes in place for a representative of the financial adviser to determine
whether the new product is suitable for the targeted client, taking into consideration the nature,
key risks and features of the new product. The financial adviser is prohibited from selling or
marketing any new product to any targeted client unless every member of its senior management
has, on the basis of the result of the due diligence exercise, personally satisfied himself that the
new product is suitable for the targeted client and personally approved the sale or marketing of
the new product to the targeted client. “Targeted client” excludes accredited investors.
As a result of our exemption from compliance with Regulation 18B of the FAR when wedeal with you as an accredited investor, we are not under any statutory obligation to carryout a due diligence exercise to ascertain whether any new product we wish to sell or market
to you is suitable for you. You are therefore not protected by the requirements ofRegulation 18B of the FAR.
23. Financial Advisers (Complaints Handling and Resolution) Regulations 2021 (the “CHR
Regulations”). The CHR Regulations came into effect on 3 January 2022 and it establishedcertain prescribed requirements on complaints handling, and resolution for financial advisory firms
when dealing with complaints from retail clients who are natural persons. The complaints handlingand resolution process established under the CHR Regulations does not apply to accredited
investors. The CHR Regulations impose the following obligations on the financial advisory firms indealing with complaints from retail clients who are natural persons –To establish an independent unit which will handle and resolve, or supervise the handlingand resolution of, complaints received by the financial advisory firm;
To establish a process for handling and resolving complaints which is independent andprompt;80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

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





To designate a senior management member or committee comprising senior management
members within the firm who are not directly involved in the provision of any financial
advisory service to be responsible for the oversight of its compliance with CHR Regulations;
To ensure that information on its complaints handling and resolution process is publicly
available;
To put in place a centralised management system to record, track and manage complaints;
andTo report its complaints data to Monetary Authority of Singapore on a biannual basis.

As a result of our exemption from compliance when we deal with you as an accredited
investor, we are not under any statutory obligations to handle and resolve any complaintin accordance with the prescribed requirements under the CHR Regulations and you are
therefore not protected by the prescribed complaint handling procedure and resolution
process under the CHR Regulations.

80 Raffles Place, No.18‐01 UOB Plaza 1, Singapore 048624

A CITIC Securities Company
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