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Description of conflicts of interest policy
In accordance with the Markets in Financial Instruments Directive 2004/39/EC of the European Parliament and of the European Council) and the Financial Instrument Market Law of the Republic of Latvia, Renesource Capital, while providing investment services and ancillary investment services, must provide customers the information about the policy regarding management of conflicts of interest in the field of investment.
A conflict of interest is a situation where two conflicting interests meet in the performance of professional duties, including personal and professional interests, or situations where two contrary professional interests meet, for example, interests of two different customers.
After analyzing potential conditions that underlie the emergence of conflict of interest, the Company has determined situations where the Company itself or related persons could be drawn into a conflict of interest.
Conflict of interests may arise:
- between the Company and a customer;
- between the Company’s employee and a customer;
- between a tied agent of the Company and a customer;
- between a person who directly or indirectly controls the Company and a customer;
- between customers of the Company;
- between a person related to the Company and a customer.
Conflict of interest may arise, for example, in situations where the Company, the Company’s employee, a person related to the Company or a person who directly or indirectly control the Company:
- is likely to make a financial gain or avoid a financial loss at the expense of a customer;
- has an interest in the outcome of a service provided to a customer or of a transaction carried out on behalf of a customer, which is distinct from the customer's interest in that outcome;
- has an incentive to favor the interests of another customer or a group of customers;
- carries out the same professional activity as the customer;
- receives or will receive an inducement from other persons in relation to a service provided to the customer, in the form of monies, goods or services, other than the standard commission or fee for that service.
Conflict of interests may arise during the provision of the following investment services and ancillary investment services, in situations where:
- the Company simultaneously sells and purchases financial instruments on behalf of two different Customers;
- the Company provides services of individual portfolio management.
Being aware of the potential conflicts of interest, the Company has developed and affirmed the conflicts of interest policy, enacted the administrative measures and the internal procedures to efficiently detect and minimize possible situations of conflict of interest and to reduce negative consequences that may arise during the provision of investment services or ancillary investment services.
Based upon the conflicts of interest policy and the internal regulations of the Company, the following measures were taken:
- the Company employees are responsible for arising situations of conflict of interest and they have to inform the respective departments of the Company about possible situations of the emergence of conflict of interest;
- relations with the customers of the Company are built in accordance with equal rights, on the basis of integrity and fair practice, informing customers about all transactions with the customers’ financial instruments and funds and the related risks;
- in all circumstances, a customer has an advantage over interests of the Company or its employees.
To reduce the possibility of conflict of interest, the Company has developed organizational and administrative measures that regulate execution of personal transactions in financial instruments of the Company employees and persons related to the Company. The Company has adopted the code of conduct limiting the acceptance of gifts, contributions and other gratitudes from customers, thereby reducing the possibility of the emergence of conflict of interest.
The Company has established the high standards of ethics for its employees in the performance of their duties, the standards of business practice when working with customers, and it ensures their regular updating.