Financial Advisers (Personalised DIMS) Regulations 2014

Client agreements governing personalised DIMS provided to retail clients

6 Client agreements must provide for certain matters
  • (1) A client agreement required by section 41 of the Act must, in accordance with section 42(1) of the Act, provide adequately for the following matters:

    • (a) if client money or client property is to be held under the service on behalf of clients,—

      • (i) how custodial services will be provided under the service and the process for appointing and removing a custodian; and

      • (ii) whether and, if so, how the client may give instructions to exercise rights over the client’s financial products (for example, a right to vote at meetings of product holders); and

      • (iii) the consequences of the termination of the client agreement, including whether any financial products held by a custodian on behalf of the client under the service will be transferred to the client, will continue to be held by the custodian, or will be sold; and

      • (iv) how holdings of wholesale products (if any) will be dealt with on termination of the client agreement:

    • (b) how the investment authority may be changed:

    • (c) a right for the client to terminate the client agreement without penalty:

    • (d) how the right under paragraph (c) may be exercised within a reasonable notice period.

    (2) Wholesale products, in subclause (1)(a)(iv), means financial products that the client is eligible to acquire only by virtue of the client acquiring the products through a discretionary investment management service.

    Compare: LI 2014/50 r 44