INTRODUCTION

Total Global Steel Limited (‘the Company’) aims to identify and prevent conflicts of interest which may arise between itself and its clients, and between one client and another, in order to avoid any adverse effect on any of its clients. This Policy sets out the procedures, practices and controls in place to achieve this.

This policy apples to all Officers (whether Executive or Non-Executive), Associates, Affiliates and/or employees of the Company (‘personnel’) all personnel and any person(s) directly or indirectly linked to the Company and refers to interactions with all clients of the Company and its wider corporate group.

2. REGULATORY REQUIREMENTS RELATING TO CONFLICTS OF INTEREST

The Financial Services Authority (‘FSA’) has detailed requirements relating to the management of conflicts of interest, which are found primarily in the FSA Handbook of Rules and Guidance at SYSC 10 (Senior Management Arrangements, Systems & Controls). Amongst other things, SYSC 10 requires the Company to:

(a) take all reasonable steps to identify conflicts of interest between it and the Company’s client, or one of the Company’s clients and another;

(b) keep and regularly update a record of the kinds of service or activity it carries on (or which is carried on, on its behalf) in which a conflict of interest entailing a material risk of damage to the interests of one or more clients has arisen or may arise;

(c) maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of its clients;

(d) establish, implement and maintain an effective, written Conflicts of Interest Policy.

As with all laws and regulations applicable to its business, the Company takes its obligations to comply with regulatory requirements relating to conflicts of interest, very seriously.

Types of conflict which may carry a material risk of damage to the interests of a client include, but are not limited to, the following.

3. SCOPE

Where the Company or any person directly or indirectly linked to the Company and its wider corporate group:

(a) is likely to make a financial gain or avoid a financial loss at the expense of the client;

(b) has an interest in the outcome of a service provided to, or of a transaction carried out on behalf of, the client which is distinct from the client’s interest in that outcome;

(c) has a financial or other incentive to favour the interests of another client or group of clients over the interest of the client;

(d) carries on the same business as the client;

(e) receives, or will receive, from a person other than the client, an inducement in relation to the service provided to the client in the form of monies, goods or services, other than the standard commission, fee or charge for that service;

(f) designs, markets or recommends a product or service without properly considering all of the Company’s other products and services and the interests of its clients.

4. GUARDING AGAINST CONFLICTS OF INTEREST

A number of systems and procedures are in place in order that the potential for conflicts of interest is minimised.

4.1 Personal Account Dealing

All personnel are bound by the requirements of the Company’s Personal Account Dealing Notice. All transactions undertaken by such personnel are actively monitored by the Company’s Compliance Department.

4.1.1 Personnel are prohibited from being involved in activities which may in any way suggest that they are representing the interests of the Company or of a client if such activity is likely to appear to be inconsistent with providing an objective and/or unbiased assessment of the value or prospects of the relevant investments.

4.1.2 Personnel must not act in a way which appears to be representing the issuer/provider of a relevant investment.

4.1.3 The Company may not offer or accept an inducement to provide favourable market/investment research/information and/or opinion.

4.2 Register of Information

Where any personnel believe that they have, or may have, information that is not in the public domain and is likely to affect the price of a financial instrument in relation to which the Company provides execution or advisory services, once it becomes generally known, they must immediately advise the Company’s Compliance Department.

The Compliance Department maintains a register of such information and a person in possession of such information will be prohibited from:

• Carrying out any personal account dealings relating to the financial instrument in question;
• Making a recommendation to clients in relation to the financial instrument in question;
• Divulging the information to any other individual, except with the express approval of the Compliance Department.

These same restrictions also apply to Compliance personnel, who will also be considered ‘insiders’ in respect of the information received. The restrictions will remain in place until either the information is in the public domain or it ceases to be price sensitive.

4.3 Chinese Walls

The term ‘Chinese Wall’ is used to define an established arrangement which prevents the unauthorised flow of confidential or inside information from one part of the Company, the Corporate Group to another. The Company’s Chinese Wall arrangements define the circumstances in which the Company can communicate confidential or inside information within a part of the Company, the Corporate Group or between different parts of the Company, or the Corporate Group.

4.4 ‘Need to Know’ Policy

Where an individual is in possession of confidential or inside information, they may not disclose it to another party without ensuring that:

• there is a clear need to know on the part of the recipient;
• the procedures set out in this Policy are adhered to;
• where the information relates to a client, the information transfer is in accordance with the best interest of the client; and
• the receiving individual is made aware of the need to treat the information as confidential.

Only such information as is needed to meet the use to which it is to be put may be disclosed and the receiving individual is then bound by the same restrictions.

4.5 Restriction on access to information/electronic data

The Company operates a clear desk policy in order to minimise the risk of accidental disseminating confidential information. All personnel are asked to ensure that when they leave their desk unattended, correspondence and information is not left on the desk so that it is visible and the computers are either switched off or locked. As an additional precaution, computers will automatically lock if unattended for a short period.

The access to computer drives and to files located within drives can be and is restricted by the use of passwords and user ID’s. Approval by an authorised person is required for access to any drive to be shared with users from other departments.

In addition, personnel are reminded of the importance of the data protection and archiving policies in place. Where confidential information is to be disposed of, personnel should ensure that it is done so securely.

4.6 Gifts and Inducements

Personnel must not solicit, offer or accept any gift or inducement which may influence their independence or business judgement, or which could create a conflict with any duty owed to the Company or its clients.

This restriction does not include special promotions on products and services which have been agreed by the Directorate of the Company I, nor does it cover corporate gifts and hospitality which are considered to be incidental to the ordinary business of the Company. Examples of gifts and inducements which should not be offered or accepted include cash, gifts readily convertible into cash or any other object of significant value.

Personnel are required to register with the Compliance Department details of hospitality or gifts, whether given or received, with an estimated value in excess of £50.00 and to seek guidance from that Department if in doubt in relation to the suitability of any gift.

Such items are recorded in ‘The Gifts Register’ which is subject to regulatory inspection.

4.7 External Business Interests

Personnel undertake that they will not, whilst employed by the Company and without the prior written consent of the Directorate, be engaged in or have an interest either directly or indirectly, in any trade, business or occupation, which is or may be in competition with the Company and/or which would involve use of the Company’s time, property, facilities and resources.

4.8 Segregation of Duties

Job roles are designed to limit the potential for conflicts of interest. Where appropriate and proportionate, systems and controls exist to prevent personnel from undertaking roles where such a conflict may exist. However, due to the nature, scale and complexity of the Company’s business, there can be occasions when personnel are required to undertake duties that could give rise to a conflict. In this event, every effort is made to ensure such circumstances exist only for a limited period or for additional controls to be in place to identify inappropriate behaviour.

The suitability of all personnel is assessed for competency from time to time, and all are required to follow internal procedures as detailed in the Company’s Compliance Manual. Where a potential conflict is seen to exist within a role, additional monitoring, control and sign-off procedures are in place to mitigate any such conflict. Audit records, reconciliation procedures and compliance monitoring arrangements are also in place to ensure all processes are adequately controlled and reviewed.

As part of the Company’s Segregation of Duty Policy, no one individual is authorised to carry out the following four functions simultaneously:

• Authority to initiate a transaction
• Authority to bind the firm
• Authority to make the payment
• Authority to account for the above

As part of a review of each department’s operations, the roles undertaken by individuals within that department and the segregation of duties are reviewed as appropriate.

All departments within the Company are accountable to the Directorate and receive individual supervision from the Directorate. Inside information passed between departments is on a ‘need to know’ basis in accordance with the need to know policy described above.

4.9 Remuneration Policy
The remuneration-setting process is designed to avoid potential conflicts of interest. In setting levels of remuneration, the Company pays due regard to any potential conflicts of interest and ensures there is no direct relationship between the level of business transacted by clients and a specific individual’s remuneration. It is relevant to note that the Company does not conduct any significant advisory or semi-advisory business. In addition to this, the Company operates a Commission to Equity Ratio Monitoring Programme which assists monitoring in this regard.

4.10 Public Interest Disclosure Policy

The Company is committed to ensuring that malpractice is prevented and, should it arise, immediately dealt with. Personnel are made fully aware to whom they can and should report public interest issues.

The Public Interest Disclosure Act 1998 (‘PIDA’) allows personnel to disclose certain issues to particular external parties where there is good reason to believe that internal disclosure will not be taken seriously or will cause the member of personnel making the disclosure to be penalised in some way. the Company encourages personnel to raise their concerns about any malpractice internally at the earliest possible stage and this procedure sets out the correct method for raising such concerns and the general principles of how matters should be dealt with. It does not, however, confer any contractual rights.

For the protection of all personnel, the Company has laid down a formal procedure through which the Policy is implemented. These procedures apply equally to all personnel who have reasonable grounds to believe that malpractice has occurred, is occurring or is likely to occur within the Company. Personnel are responsible for taking appropriate, reasonable and timely action wherever and whenever they become aware of any situation or matter that could expose the Company to loss, liability or embarrassment.

For the purposes of this procedure and the PIDA, the following constitute
malpractice:

(a) a serious breach of FSA Rules
(b) the commission of a criminal offence;
(c) failure to comply with a legal obligation;
(d) the occurrence of a miscarriage of justice;
(e) the endangerment of an individual’s health and safety;
(f) the endangerment of the environment; and
(g) the concealment of any information relating to any of the above.

Personnel are therefore encouraged to follow the steps laid out in this procedure, ensuring they are able to raise genuine concerns about malpractice within the Company without fear of harassment or victimisation.

4.11 Independence Policy

Where the Company has an interest, arrangement or relationship which may be considered likely to influence any exercise of discretion by the Company in the course of dealings or other services for or on behalf of a client in a manner which is material to the client, the Company is required to disregard that interest, arrangement or relationship when exercising that discretion.

Amongst other things, this means that those charged with executing client orders or providing other services to clients must disregard knowledge
they have about other clients when executing orders for or providing services to the first client. Using knowledge of customer orders as the basis for trading decisions or disclosing such knowledge is Market Abuse and is strictly prohibited.

4.12 Training

The Company will provide appropriate training to its personnel on conflicts of interest and its procedures for managing conflicts of interest.

4.13 Disclosure Policy

The Company considers that its internal policies and procedures, systems and controls, generally mitigate the risk of any conflict of interest arising,
either between itself and a client or between two or more clients.

Where, however, the potential for conflict arises and that conflict cannot be avoided, (for example with the aggregation of client’s dealing instructions) full disclosure is made.

POLICY REVIEW

The Company reviews its Conflicts of Interest Policy from time to time, to ensure it covers conflicts that can be reasonably expected to arise within the course of its business. Any significant amendments will be approved by Senior Management.