CMB Regulations Inapplicable For Qualified Investors

The provisions of the legislation that professional clients cannot benefit from, as stated in the second paragraph of Article 31 of the Communiqué on Investment Institutions, are set out below:

a) Reconciliation of assets in custody is not mandatory, provided that written consent is obtained:

Pursuant to the first paragraph of Article 68 of the Communiqué on Investment Services titled "reconciliation between the client and the custodian institution", a written or electronic reconciliation must be made at least 1 time in each calendar year by the department or personnel responsible for internal control of the investment institution authorized to provide custody services and the custodian institution regarding the capital market instruments and cash owned by the client. Pursuant to the second paragraph of the same article, in the event that written consent is obtained from professional customers, the reconciliation mentioned in the first paragraph is not mandatory.

b) Monthly notification on the balance of the assets in custody accounts is not mandatory, provided that an agreement is concluded:

Pursuant to the first paragraph of Article 69 of the Communiqué on Investment Services titled "notification on the client assets", the investment institution authorized to act as custodian is required to notify the clients at least once a month regarding the capital market instruments and cash owned by the clients within the framework of the principles set forth in the document and record regulations of the Board, and it is possible to sign an agreement with the professional clients regarding non-notification or to include this issue in the framework agreement.

c) Conducting a compliance test is not mandatory:

According to the first paragraph of Article 33 of the Communiqué on Investment Institutions titled "compliance test", investment institutions are obliged to conduct compliance tests only for general clients within the scope of trading intermediation and public offering intermediation activities.

d) In the appropriateness test, it is sufficient to obtain information on investment objectives, investment duration and risk and return preferences:

According to the fourth paragraph of Article 40 of the Communiqué on Investment Services titled "appropriateness test", it is not necessary to obtain the following information, except those accepted upon request, with regards to the professional clients;

• Information about the income level and investment assets to assess whether the client's financial condition is sufficient to cover the risks of investment
• Information about the client's age and profession, educational status, whether a general or a professional client, capital market instruments subject to transactions realized in the past, type, nature, volume and frequency of such transactions (information specified in subparagraphs (b) and (c) of the second paragraph of the relevant Article) to assess whether the client has the knowledge and experience to understand the risks related to the transactions to be realized in the client's portfolio or account.

e) Additional risk notifications other than the general risk notification form are disclosed upon request:

Pursuant to the second paragraph of Article 25 of the Communiqué on Investment Institutions titled "obligation to notify the client about the risks", investment institutions are obliged to explain the risks of the capital market instruments subject to the transaction to the client as specified in the third paragraph in addition to the general risk notification made pursuant to the first paragraph before providing services to their general clients within the scope of trading intermediation activity and to obtain a written declaration that the explanations have been read and understood by the client. The seventh paragraph of the same Article stipulates that the investment institution is obliged to make the disclosures under the second and third paragraphs upon the request of professional clients.