Can I be treated as an elective professional client?
Under the rules of the Financial Conduct Authority (FCA), Prodigy may treat you as an elective professional client if, after an assessment of your expertise, experience, and knowledge, we are reasonably assured that, in light of the nature of the transactions or services envisaged, you are capable of making your own investment decisions and understanding the risks involved. In making our assessment we may rely on information we already possess about you and/or request additional information from you and/or call you to discuss your investment experience. This is the “qualitative test”.
In addition, you must satisfy and provide us with evidence of, at least 2 of the following 3 criteria (the “quantitative test”):
(1) You have carried out transactions, in significant size (i.e. minimum of 4 trades, sum of total notional value €200,000 or more), in listed instruments or bonds on the relevant market at an average frequency of 10 per quarter over the previous 4 quarters.
(2) The size of your financial instrument portfolio, defined as including cash deposits AND financial instruments, exceeds €500,000.
(3) You work or have worked in the financial sector for at least one year in a professional position, which requires knowledge of the transaction or services envisaged.
The procedure we need to follow to be able to treat you as an elective professional client
Pursuant to the European Markets in Financial Instruments Directive (“MiFID”), we may treat you as an Elective Professional client provided that before any investment is completed:
We have received a written application form from you requesting to be treated as such,either generally or in respect of a particular service or transaction or type of transaction or product;
You received a clear written warning of the protections and investor compensation rights which you will lose by opting to be treated as an Elective Professional client; (please see the risk warning about loss of protection below)
You must state in writing, in a separate document from the contract, that you are aware of the consequences of losing such protections.
Clients of the professional client category do not benefit from the higher degree of protection afforded to the retail client. Please refer to the risk warning below on the main differences in regulatory protections that apply to a professional client as compared with a retail client in relation to MiFID or equivalent third country business in respect of services provided by Prodigy.
If Prodigy accepts your request, you will be categorised as a professional client. However, if Prodigy does not accept your request, you will be treated as a retail client which means you may not be able to receive information about all investment products offered.
Please send us an email at firstname.lastname@example.org in order for us to assess your suitability to be treated as an Elective Professional client or if you’d like further information.
For the purpose of this exercise, we make it clear to you that by assessing you and offering to send you marketing information, we are not acting for you. As you are not a client of Prodigy Services Limited, we will not be responsible to you for providing protections afforded to clients of the firm or advising you on the relevant transaction for which you have requested information.
Risk warning about loss of protection
Please note this is not comprehensive and it summarises certain provisions. While accurate at the time of publication, FCA rules are subject to change. We will seek to keep this document up to date and may update the contents of this document, but we are not required to notify you of any such changes.
Communications, including financial promotions made by us with professional clients are not subject to all of the requirements imposed by the FCA on communications with Retail clients. As a result, communications may be less frequent and/or more complex in nature to how we would communicate to a Retail Client. The Firm will still be required to ensure that all financial promotions are fair, clear and not misleading. If you have any concerns about your understanding of the product or associated risks, you should not elect to be treated as a professional client.
Information provisions about Prodigy (hereafter, “the Firm”), its services, and remuneration that are required with respect to retail clients are not all required with respect to professional clients. Therefore, the level of granularity of information, the medium and timing of such information provisions may be less specific for clients that are not Retail Clients, for example, in relation to the Firm’s remuneration arrangements, costs and charges associated with the investment, difficulties in handling your order, the timing for providing confirmation that a transaction has been carried out.
The requirements to deliver certain product-specific documents, such as Key Information Documents (“KID”) for Non-Mainstream Pooled Investment (NMPI), are not applied to professional clients.
Risk Warnings prescribed for Retail Clients are not required for promotions or materials made available to Elective Professional Clients.
Professional clients are not eligible complainants with respect to the Financial Ombudsman Services (“FOS”).
Eligibility for compensation from the Financial Services Compensation Scheme may be affected, and you may not have access to the Financial Services Compensation Scheme in relation to the investment.
The FCA rules restrict the Firm’s ability to exclude or restrict any duty of liability which the Firm owes to Retail Clients more strictly than in respect to Professional Clients.
Pre-requirements for the entry into written basic agreements for designated investment business may not apply to professional clients
With respect to non-advised services, the Firm is not required to request information or adhere to the same procedures when assessing the appropriateness of a given service or product for a professional client, for example, we are not required to apply a specific test to ascertain whether you have the requisite investment knowledge and experience to understand the risks associated with the investment, but rather we are entitled to assume that you do have the necessary level of experience, knowledge and expertise to understand the risks involved in the investment and The Firm may not be required to give warnings to the professional client if the Firm cannot determine appropriateness with respect to a given services or product.